used and the company paid $1.35 per yard. Standard time was two direct labor hours per unit at a standard rate of $16.00 per direct labor hour. Employees worked 1,300 hours and were paid $14.50 per hour. Read the requirements. Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following: Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. actual quantity; FOH = fixed overhead; SC= standard cost; SQ = standard quantity.) Requirements 1. What are the benefits of setting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances