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WorksheetsSTANDARD COSTING AND VARIANCE ANALYSIS
Total questions: 15
Worksheet time: 6mins
What is standard cost?
The average unit cost of product produced by other companies.
The average unit cost of product produced in the current period.
The budgeted unit cost of product produced in a particular period.
The average unit cost of product produced in the previous period.
The estimated expenses of budgeted production refers to the:
Production cost
Budgeted cost
Standard cost
Actual cost
A document that records the standard cost of a single unit of product is known as
Materials cost card
Standard cost card
Product expense card
Sarah Sweet Enterprise produces a candy known as Yummy. The company uses a standard costing system. To produce 1 (one) unit of Yummy, the company require direct materials of 6 grams. The standard cost of direct materials is RM10 per grams.
Based on the above information, what is the standard direct materials cost per unit of Yummy? Give your answer in RM (i.e. RM10)
(a)
MCO Manufacturer uses a standard costing system and the following information belongs to the company:
Basic wage rate: RM12 per hour
Labor benefits: RM2 per hour
Basic time: 2 hours per unit
Allowance for idle time: 0.5 hours per unit
Based on the above information, what is the standard direct labor cost per unit? Please give your answer in RM (i.e. RM10)
(a)
A formula for computing direct materials price variance is
Actual quantity purchased × (Actual rate - Standard rate)
Standard quantity purchased × (Actual rate + Standard rate)
Actual quantity purchased × (Actual rate + Standard rate)
Standard quantity purchased × (Actual rate - Standard rate)
A favorable direct materials price variance occurs when:
actual rate of direct materials is equal to standard rate of direct materials
actual rate of direct materials is less than standard rate of direct materials
actual rate of direct materials is higher than standard rate of direct materials
actual rate of direct materials is less than previous year's rate of direct materials
The Tee Shirt Enterprise uses a standard costing system. The company established the following direct materials cost standards for one unit of T-shirt:
Standard Quantity - 4 grams
Standard Rate - RM5/gram
Standard Cost - RM20
During the month of April, Tee Shirt Enterprise purchased 25,000 grams of materials at a cost of RM128,750 and used 10,250 grams of materials to produce 2,500 units of T-shirt. The direct materials price variance for January was:
RM3,700 Unfavorable
RM3,700 Favorable
RM3,750 Unfavorable
RM3,750 Favorable
SOS Manufacturing uses a standard costing system to produce . The following direct materials cost standards for one unit of Tomato Sauce:
Standard Quantity - 4 grams
Standard Rate - RM5/gram
Standard Cost - RM20
Last month, SOS Manufacturing purchased 40,000 grams of direct materials at a cost of RM199,200 and produced 5,000 units of product X Tomato Sauce using 19,750 grams of direct materials. Calculate the direct materials quantity variance for the last month.
800 Favorable
1,250 Unfavorable
800 Unfavorable
1,250 Favorable
Hand Care Manufacturer used the following direct labor cost standards for one unit of hand sanitizer:
Standard hours: 1.5 hours
Standard rate: RM20 / hour
Standard cost: RM30 (1.5 hours @ RM20 / hour)
Last April, the company recorded 20,000 direct labor hours and 12,500 units of hand sanitizer were produced. The total wages of direct labor in April were RM405,000. Calculate the direct labor rate variance for April.
RM30,000 Unfavorable
RM25,000 Unfavorable
RM30,000 Favorable
RM25,000 Favorable
Which of the following cannot be a reason of unfavorable direct materials price variance?
Excellent employee training program
Inefficient standard setting
Ineffective purchasing agent
Sudden rise price of materials
Which of the following cannot be a reason of unfavorable direct materials quantity variance?
Unmotivated workers
Lack of supervision
Frequent power failures
Uneconomical order size
Frequent breakdown is not likely to be a reason of unfavorable direct labor rate variance
Yes
No
Increase in direct materials prices is not likely to be a reason of unfavorable direct labor efficiency variance
Yes
No
If:
the standard direct labor rate was RM10 per hour;
the direct labor rate variance amounted to RM450 favorable; and
the actual direct labor cost amounted to RM39,550.
The actual direct labor hours worked were:
3,955 hours
4,500 hours
3,910 hours
4,000 hours
