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XANGHAI Corp. manufactures changeable typeheads for use on portable typewriters. Each typehead is in a set consisting of the lead alloy typehead itself, a cover

XANGHAI Corp. manufactures changeable typeheads for use on portable typewriters. Each typehead is in a set consisting of the lead alloy typehead itself, a cover for the key on the typewriter keyboard, and a plastic box to hold the two items. At the beginning and end of June, there were no materials inventories. The following standards were developed for each unit: Item Standard per Unit Materials: Lead alloy (3 oz. @ P.22) P .66 Cover materials (6 oz. @ P.04) .24 Container boxes (1 @ P.10) .10 Direct labor (1/4 hr. @ P12 per hr.) 3.00 Overhead (P10 per direct labor hour) 2.50 Total cost P 6.50 Annual production is estimated at 50,000 units, with fixed overhead of P25,000. During the past year, the following costs were incurred to produce 40,000 units: Materials: Lead alloy: 122,000 oz. @ P.20 Cover materials: 235,000 oz. @ P.04 Container boxes: 40,500 @ P.09 Direct labor: 9,500 hrs. @ P12.50 Overhead: P90,000 What is the labor rate variance?

a. P4,750 U

b. P6,000 F

c. P4,750 F

d. P6,000 U

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