Wyllianne hunt uses a standard costing system in the...

Wyllianne Hunt uses a standard costing system in the manufacture of its single product. The 35,000 units of raw material in inventory were purchased for Php105,000 and two units of raw materials are required to produce one unit of final product. In November, the company produced 12,000 units of product. The standard cost allowed for materials was Php60,000 and there was an unfavorable quantity variance of Php2,500. What is the materials price variance for the units used in November?

Transcript

00:01 Okay, in the given question, kasivan production makes a product that requires a material and the standard quantity for the material consumption is given as standard quantity that required is 3 .8 pounds for per unit.

00:15 So if we are going to produce a unit of that product, then we have to use 308 pounds.

00:22 So 3 .8 pounds per unit is required and the standard price is also given.

00:28 Standard price it's dollar four per pound now if we see the other figure it's given that actually in actual the production where actual production amounted to 7 ,300 units so 7 ,300 units were produced during the month of november and actual quantity used for this production was so aq is the actual quantity was 28710 pounds so it's 28710 pound.

01:12 Now for producing 7 ,300 units, if the standard is maintained, that is 3 .8 pound per unit, then the standard quantity that we should be using was standard quantity for actual production.

01:30 Actual production.

01:31 So this will be 7 ,300 units were produced and for each unit 3 .8 pounds are required as per the standard.

01:41 3 .8 pounds.

01:45 So this comes to 27740 pounds.

01:54 Also it is given that during the month the company purchased 30 ,800 pounds of direct material at a cost of dollar double one seven zero four years.

02:07 So from here we can find out the actual price actual price.

02:14 So total cost incurred for purchasing 30 ,800 pounds.

02:21 To a 11740.

02:28 So if we divide this, we are getting $3 .8 per pound.

02:34 So we have different figures here.

02:36 Now we have to find out the material price variance.

02:40 So we know that material price variance is the variances arise due to the variation in prices as per the standard and actual...