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Ricafrente Company's budgeted fixed factory overhead cost is Php125,000 per month plus a variable factory overhead of Php5.00 per direct labor hour. The standard direct labor hours allowed for January production was 45,000. An analysis of the factory overhead indicates that in January, the Ricafrente Company had an unfavorable budget (controllable) variance of Php5,000 and an unfavorable volume variance of Php2,500. The Company uses two-way analysis of overhead variance.
Problem 1: Determine the standard factory overhead measured in January.
Group of answer choices
Option 1: Php 347,500
Option 2: Php 352,500
Option 3: Php 350,000
Option 4: Php 355,000
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