X department Uses a standard-cost system and a flexible budget.

denominator activity is:

machine hours 140

Finished pieces 2,800.....

580 Chapter 14 Illustrative Problem 14.3. Computation of Standard Cost Per U Variance Analysis X Department uses a standard-cost system and a flexible budget. Denominator activity is: Machine-hours Finished pieces produced 140 2,800 The standard costs in connection with this production are: Direct materials @ P1.20 P3,360 Direct labor @ PO.1125 315 Factory overhead (including an allowance for variable overhead at the rate of P0.30 per piece) 1.400 P5.075 The actual production for a month was: Machine-hours 130 Finished pieces produced 2,860 The actual cost of this production was: Direct materials P3.575 / 286 Direct labor Factory overhead, including P573 of fixed overhead 1,573 P5.434 Direct labor hours and machine-hours are proportional. REQUIRED: Answer the following questions: 1. What was the standard cost per finished piece? 2. What is the total material variance? Indicate whether the variance favorable or unfavorable. Give the peso amounts. 3. Compute and analyze the direct labor costs variances. 4. Compute and analyze the factory overhead variance. a. Two-variance method b. Three-variance method C. Four-variance method