a.Compute for the actual cost paid per kilogram b.Compute for the Labor Efficiency VariancePresent your answer as 1000 FAVORABLE OR 1000 UNFAVORABLE if applicableTopic: Standard Costing and Variance Analysis MARIETTA Co. adopted a standard cost system several years ago. Thestandard costs for the prime costs of its single product follow:Material: 10 kg @ P4.50/kgLabor: 6 hours @ P8.50/hrP45.00P51.00The following operating data were taken from the records for November:Units completed5,800 unitsBudgeted outputMaterials purchasedTotal actual labor costsActual hours of labor6,000 units60,000 kgP306,60036,500 hoursMaterial usage varianceTotal material varianceP2,250 unfavorableP450 unfavorableGR

Labor efficiency variance is the difference between the actual number of direct labor hours worked…

Answered: Compute for the actual cost paid per…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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a.Compute for the actual cost paid per kilogram

b.Compute for the Labor Efficiency Variance

Present your answer as 1000 FAVORABLE OR 1000 UNFAVORABLE if applicable

Topic: Standard Costing and Variance Analysis

MARIETTA Co. adopted a standard cost system several years ago. The
standard costs for the prime costs of its single product follow:
Material: 10 kg @ P4.50/kg
Labor: 6 hours @ P8.50/hr
P45.00
P51.00
The following operating data were taken from the records for November:
Units completed
5,800 units
Budgeted output
Materials purchased
Total actual labor costs
Actual hours of labor
6,000 units
60,000 kg
P306,600
36,500 hours
Material usage variance
Total material variance
P2,250 unfavorable
P450 unfavorable
GR

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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