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Assignment 8
1. During August 2014, a company produced 1,000 units of a product using 3,600 pounds of
direct material at a cost of P2.20 per pound. The direct material standard requires 4 pounds of
material per unit of product at a standard price of P2.00 per pound. The material efficiency
(volume/quantity) variance is:
a. P 880 favorable
c. P 800 favorable
b. P 880 unfavorable
d. P 800 unfavorable
2.

Staff Company uses a standard cost system Information for raw materials for Product RB for
the month of October are as follows:
Standard unit price
Actual purchase price per unit
Actual quantity purchased
Actual quantity used
Standard quantity allowed for actual
production

P1.60
P1.55
2,000 units
1,900 units
1,800 units

What is the material purchase price variance?

a. P 90 favorable
c. P 100 favorable
b. P 90 unfavorable
d. P 100 unfavorable
3. Information on Marvin Companys direct materials cost is as follows:
Actual units of direct materials
Actual direct materials cost
Standard price per unit of direct
materials
Direct materials efficiency variance
(favorable)

20,000
P40,000
P2.10
P3,000

Marvin Companys direct material price variance was:

a. P 1,000 favorable
c. P 2,000 favorable
b. P 1,000 unfavorable
d. P 2,000 unfavorable
The following data are used for the next questions.
The Big Book Company builds wooden bookshelf wall units. The companys standard costs are:
Wood
Trim
Direct labor
Variable
overhead
Fixed overhead

25 pounds at P6.40 per pound

8 pounds at P10.00 per pound
5 hours at P12.00 per hour
P30.00 per unit
P130,000 per period, applied at the rate of
P20 per unit

A recent months transaction were: 160,000 pounds of wood were purchased at P6.50 per
pound; 50,000 pounds of trim were purchased at P9.60 per pound. 155,000 pounds of wood
were issued to production; 48,500 pounds of trim were issued to production. Direct labor
incurred was 31,000 hours at an average cost of P11.50 per hour. Overhead costs were

P302,000, of which P181,000 were variable. Six thousand units were produced during the
month.
4. What was the total actual cost of wood purchased?
a. P 1,007,500
c. P 1,040,000
b. P 1,024,000
d. P 480,000
5. What was the total standard cost of wood purchased?
a. P 500,000
c. P 1,024,000
b. P 992,000
d. P 1,040,000
6. What was the wood price variance?
a. P 48,000 favorable
b. P 16,000 unfavorable

c. P 48,000 unfavorable
d. P 16,000 favorable

7. What was the total actual cost of trim purchased?

a. P 1,488,000
c. P 465,600
b. P 500,000
d. 480,000
8. What was the trim price variance?
a. P 5,000 favorable
b. P 20,000 unfavorable

c. P 5,000 unfavorable
d. P 20,000 favorable

9. What was the trim efficiency variance?

a. P 10,000 favorable
b. P 20,000 unfavorable

c. P 5,000 unfavorable
d. P 15,000 favorable

10.What was the direct labor price variance?

a. P 12,000 favorable
c. P 3,500 favorable
b. P 15,500 favorable
d. P 19,000 favorable
11.What was the direct labor efficiency variance?
a. P 3,500 unfavorable
c. P 15,500 unfavorable
b. P 3,500 favorable
d. P 15,500 favorable

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(-5 on total score if answered using yellow paper)

Assignment 8
Seatwork Lesson 6, Standard Costing (-5 on total score if answered using yellow
paper)
1.

5.

9.

2.

6.

10.

3.

7.

11.

4.

8.

Please write your solution below.