Exam 5: Journal Entries to Record Variances

Compound K72R is used to make Munuz Corporation's major product. The standard cost of compound K72R is $43.90 per ounce and the standard quantity is 1.4 ounces per unit of output. In the most recent month, 120 ounces of the compound were used to make 100 units of the output. When recording the use of materials in production, Raw Materials would be:

During the month of May, Marian Manufacturing Corporation purchased materials that had a total standard cost of $37,000. The Materials Price Variance on these materials was $6,000 favorable. What summary journal entry would Domino make to record this purchase and variance for May?

If the actual direct labor-hours used is less than the standard direct labor-hours allowed for the actual output, then the journal entry to record the Labor Efficiency Variance would be a credit.

An unfavorable materials quantity variance is recorded as a debit in the Materials Quantity Variance account.

The following standards have been established for a raw material used in the production of product G13: The following data pertain to a recent month's operations: Required: a. What is the materials price variance for the month? b. What is the materials quantity variance for the month? c. Prepare journal entries to record the purchase and use of the raw material during the month. (All raw materials are purchased on account.)

A favorable labor efficiency variance is recorded as a debit in the Labor Efficiency Variance account.

Albert Manufacturing Company manufactures a single product. The standard cost of one unit of this product is: During the month of October, 6,000 units were produced. Selected cost data relating to the month's production follow: There was no beginning inventory of raw materials. The variable overhead rate is based on direct labor-hours. Required: a. For direct materials, compute the price and quantity variances for the month, and prepare journal entries to record activity for the month. b. For direct labor, compute the rate and efficiency variances for the month, and prepare a journal entry to record labor activity for the month. c. For variable overhead, compute the rate variance for the month.

Pinkney Corporation has provided the following data concerning its direct labor costs for November: Required: Prepare the journal entry to record the incurrence of direct labor costs.

Widman, Inc. makes and sells only one product and uses standard costing. The standard cost sheet for one unit of product includes the following: • Direct materials: 5 grams at $0.35 per gram • Direct labor: 1 hour at $8 per hour Last period the company had the following results: • 5,000 grams of direct materials purchased at $0.40 per gram • 4,000 grams of direct materials used in production • 900 units of product were made • 850 hours of direct labor were used at $8.50 per hour -The journal entry to record the purchase of direct materials last period would include:

Compound K52E is a raw material used to make Pinkos Corporation's major product. The standard cost of compound K52E is $46.00 per ounce and the standard quantity is 5.0 ounces per unit of output. Data concerning the compound for March appear below: The raw material was purchased on account. -The Materials Quantity Variance for March would be recorded as a:

Enwall Corporation's standard wage rate is $11.20 per direct labor-hour (DLH) and according to the standards, each unit of output requires 2.9 DLHs. In December, 5,900 units were produced, the actual wage rate was $10.20 per DLH, and the actual hours were 14,150 DLHs. -In the journal entry to record the incurrence of direct labor costs in December, the Work in Process entry would consist of a:

The journal entry below: indicates that:

Gramajo Corporation's standard wage rate is $10.10 per direct labor-hour (DLH) and according to the standards, each unit of output requires 3.4 DLHs. In February, 2,400 units were produced, the actual wage rate was $9.40 per DLH, and the actual hours were 7,920 DLHs. In the journal entry to record the incurrence of direct labor costs in February, the Work in Process entry would consist of a:

The standards for product Q58W specify 8.4 direct labor-hours per unit at $14.00 per direct labor-hour. Last month 400 units of product Q58W were produced using 2,800 direct labor-hours at a total direct labor wage cost of $41,020. Required: a. What was the labor rate variance for the month? b. What was the labor efficiency variance for the month? c. Prepare a journal entry to record direct labor costs during the month, including the direct labor variances.

The following direct labor standards have been established for product N30A: The following data pertain to the most recent month's operations during which 400 units of product N30A were made: Required: a. What was the labor rate variance for the month? b. What was the labor efficiency variance for the month? c. Prepare a journal entry to record direct labor costs during the month, including the direct labor variances.

Florea Corporation has provided the following data concerning its most important raw material, compound K09B: The raw material was purchased on account. -The Materials Price Variance for August would be recorded as a:

If the actual rate per direct labor-hour is less than the standard rate per direct labor-hour, then the journal entry to record the Labor rate variance would be a credit.

Widman, Inc. makes and sells only one product and uses standard costing. The standard cost sheet for one unit of product includes the following: • Direct materials: 5 grams at $0.35 per gram • Direct labor: 1 hour at $8 per hour Last period the company had the following results: • 5,000 grams of direct materials purchased at $0.40 per gram • 4,000 grams of direct materials used in production • 900 units of product were made • 850 hours of direct labor were used at $8.50 per hour -The journal entry to record the incurrence of direct labor cost last period would include:

Slife Corporation has provided the following data concerning its most important raw material, compound G81N: When recording the use of materials in production, Raw Materials would be:

When the actual price to purchase a raw material on account is less than its standard price, the journal entry would include: