Standard Costing Quiz

September 29, 2021

C. N. Dait
ANSWER KEY

1. The standard cost of Product B manufactured by NGN Company includes three units of direct materials
at P5.00 per unit. During June, 30,000 units of direct materials are purchased at a cost of P4.70 and 27,600
units of direct materials are used to produce 9,000 units of Product B.

What is the material usage variance?

P2,820 F

P2,820 U

P12,00 F

P3,000 U*

2. The following data are available for KLM Manufacturing Company:

Standard material cost per unit P10

Materials usage variance P1,200 U
Standard material used for quantity produced 25,000 lbs
Materials purchased 30,000 lbs
Material price variance P2,000 U
Standard price per pound of materials P2

What is the amount paid for materials purchased?

P300,000

P302,000

P62,000*

P58,000

3. The following data are available for KLM Manufacturing Company:

Standard material cost per unit P10

Materials usage variance P1,200 U
Standard material used for quantity produced 25,000 lbs
Materials purchased 30,000 lbs
Material price variance P2,000 U
Standard price per pound of materials P2

What is the total pounds of materials actually used?

25,000

30,000

25,120

25,600*
 Standard Costing Quiz
September 29, 2021
C. N. Dait

4. NYM Fabricated Co. builds standard fabricated wooden frames for apartment walls. The standard
quantity of direct labor is 5 hours for each frame at an average hourly wage of P22. During May 2020, the
company produced 680 frames. The payroll records indicated that the carpenters worked 3,100 hours and
earned P71,300.

The standard hours allowed is

3,100 hours

3,150 hours

3,400 hours*

5,000 hours

5. NYM Fabricated Co. builds standard fabricated wooden frames for apartment walls. The standard
quantity of direct labor is 5 hours for each frame at an average hourly wage of P22. During May 2020, the
company produced 680 frames. The payroll records indicated that the carpenters worked 3,100 hours and
earned P71,300.

What is the labor rate variance?

P3,200 F

P3,500 F

P3,100 U*

P6,600 F

6. The term standard hours allowed measures

Budgeted output at actual hours

Budgeted output at standard hours

Actual output at standard hours*

Actual output at actual hours

 Standard Costing Quiz
September 29, 2021
C. N. Dait
7. When computing variances using standard cost, the difference between actual quantity issued and the
standard quantity multiplied by the standard price yields a

Price quantity variance

Material usage variance*

Material purchase price variance

Material price usage variance

8. A material price variance would not be caused by:

Ordering the wrong quality of materials

Ordering from the wrong supplier

Not taking quantity discount

Requiring laborers to work overtime *

9.The price variance reflects the difference between the quantity of inputs used and the standard quantity
allowed for the output of a period.

True

False *

10. The labor efficiency variance computed is 4,000 UF. In preparing the journal entry to recognize this
variance, Labor Efficiency Variance is credited.

True

False*

END