40.

(b)

Budgeted Factory Overhead based on 30,000 hours: P100,000

Fixed Factory Overhead as budgeted .

Variable Factory Overhead:

P120,000

x 30,000
90,000

40,000 P190,000(b)

Fixed factory overhead should remain constant regardless of how many hours were used.

41.(c)

Standard Cost per page:

Fixed Cost per month.

Variable Cost per month: (P30/hr. x 500 hr.) .

Total standard cost per month.

Divided by: No. of pages per month

(500 hrs./mo. x 20 pages / hr) ....

Standard Cost per page

Multiplied by: No. of pages generated in May

P10,000

15,000

P25,000

10,000

P2.50

12,000

P30,000(c)

42.(a)
Standard costs is the scientifically predetermined costs which should be attained under efficient
conditions. The standard direct labor cost per unit would be computed as follows:

Weekly wages per worker. P500

Add:Benefits treated as DL cost 100

Total Direct Labor Cost per week per worker........................ Divided by: No. of hours per week ...

Direct Labor Cost per hour ..

Multiplied by: no. of hr./unit.

P600

40

P 15

Standard DL cost per unit ..

43.(b)

Standard costs is the scientifically predetermined cost of manufacfuring a single unit or a specific
quantity of product during a specific period. Theoretical or ldeal standards is a standard sef for an ideal
or maximum level of activity and efficiency. Such standards constitute goals to be aimed for rather than
performances that can currently be achieved. Normal standard is a standard set for a normai level of
activity and efficiency,, intended to represent challenging yet attainable results. Therefore, engineering
estimates based on attainable performance would provide the best basis for Flirt in establishing
standard hours allowed.

44.(d)

The standard direct material cost is equal to the cost per yard. Each finished un contains 2 yards of
direct materials. The problem states that the 20% direci materk spoilage is calculated based on the
quantity of direct material input.

Standard Costing

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