The Following Materials Standards Have Been Established for a Particular

question 36

Multiple Choice

The following materials standards have been established for a particular product:
$\begin{array}{|l|r|}\hline \text { Standard quantity per unit of output } & 4.4 \text { kilograms } \\\hline \text { Standard price } & \$ 13.20 \text { per kilogram } \\\hline\end{array}$
The following data pertain to operations concerning the product for the last month:
$\begin{array}{|l|r|}\hline \text { Actual materials purchased } & 4,800 \text { kilograms } \\\hline \text { Actual cost of materials purchased } & \$ 62,880 \\\hline \text { Actual materials used in production } & 4,300 \text { kilograms } \\\hline \text { Actual output } & 70 \text { units } \\\hline\end{array}$
-What was the materials quantity variance for the month?

• A) $6,550 unfavourable.
• B) $6,600 unfavourable.
• C) $15,982 unfavourable.
• D) $16,104 unfavourable.

Understand the concept and application of standard cost systems in accounting.

Comprehend the basis of setting standard costs for manufacturing products.

Acknowledge the limitations of relying exclusively on past cost data for setting standards.

Differentiate between ideal and currently attainable standards.

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