1. Hualien Company manufactures plugs used in its manufacturing cycle at a cost of Php45 per unit that includes Php10 of fixed overhead. Hualien needs 37,500 of these plugs annually, and Ochado Company has offered to sell these units to Hualien at Php42 per unit. If Hualien decided to purchase the plugs, Php75,000 of the annual fixed overhead applied will be eliminated, and the company may be able to rent the facility previously used for manufacturing the plugs. If Hualien Company purchases the plugs but does not rent the unused facility, the company would ___

2. Macao Company is a manufacturer of industrial components. One of its products was Product X, with a selling price of Php360.00 per unit with a cost per unit of P250. The Company received a special, one-time, order for 2,400 units of Product X. Assuming that the Company is operating at full capacity and that the contribution margin of the output that would be displaced by the special order is Pho24,000. Assume that the Company is operating at full capacity and that the contribution margin of the output that would be displaced by the special order is Php24,000. Determine the minimum acceptable price.

3. Ceasar Co. is a maker of men's jeans. The company would like to maintain 32,000 yards of fabric in ending inventory. The beginning fabric inventory is expected to contain 40,000 yards. The expected yards of fabric needed for sales is 144,000. Compute the yards of fabric that Ceasar needs to purchase.

4. Ivan Company manufactures product A. Each product requires 4 units of each RM X, which has a standard cost of Php2.50 per unit. During December, the company paid a total of Php86,400 for purchases of RM X. In addition, it had the following experience with respect to RM X:

Units

Purchases 28,800

Used in manufacturing 24,000

Number of units produced 7,200

During December, determine the material price variance.

5. Willard Company has a total budgeted fixed overhead cost of Php192,000. Actual production was 45,000 units; normal capacity is 48,000 units. What was the volume variance?

6. Leo Company established a standard direct material cost of Php30 per finished unit for its main product. The standard is calculated using direct material of 6 pounds and a standard rate of Php2.50 per pound. For the month of July, Leo expected to produce 48,000 units. During the month, Leo purchased and used 260,000 pounds of material and produced 46,500 finished units. The actual price paid per pound was Php2.70. What was the material quantity variance for the month of July?

7. Bert Company has a sales budget for next month of Php150,000. Cost of goods sold is expected to be 40 percent of sales. All goods are purchased in the month used and paid for in the month following purchase. The beginning inventory of merchandise is Php5,000, and an ending inventory of Php6,000 is desired. Beginning accounts payable is Php38,000. The cost of goods sold for next month is expected to be