Royal Company Uses a Standard Costing System Royal Company Reports Its Material Price Variances at the Time

question 27

Multiple Choice

Royal Company uses a standard costing system.The following information pertains to direct materials for the month of September: $$\begin{array} { l r } \text { Standard price per kilogram } & \$ 17.00 \\\text { Actual purchase price per kilogram } & \$ 16.50 \\\text { Quantity purchased } & 3,100 \mathrm {~kg} \\\text { Quantity used } & 3,950 \mathrm {~kg} \\\text { Standard quantity allowed for actual output } & 4,000 \mathrm {~kg} \\\text { Actual output } & 1,000 \text { units }\end{array}$$ Royal Company reports its material price variances at the time of purchase.What is the material usage variance for Royal Company?

• A) $850 (U)
• B) $850 (F)
• C) $1,950 (F)
• D) $2,850 (F)

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