Exam 5: Journal Entries to Record Variances

The direct labor standards at Hebden Corporation are $10.30 per direct labor-hour (DLH) and 3.4 DLHs per unit of output. In December, 7,800 units were produced, the actual wage rate was $9.90 per DLH, and the actual hours were 21,340 DLHs. Required: Prepare the journal entry to record the incurrence of direct labor costs.

An unfavorable labor efficiency variance is recorded as a debit in the Labor Efficiency Variance account.

If the actual purchase price for materials exceeds the standard purchase price, then the journal entry to record the Direct Materials Price Variance would be a credit.

A favorable labor efficiency variance would result in a debit balance in the labor efficiency variance account.

Cafferty Corporation has provided the following data concerning its direct labor costs for March: -The journal entry to record the incurrence of direct labor costs in March would include the following for Work in Process:

Cafferty Corporation has provided the following data concerning its direct labor costs for March: -The Labor Efficiency Variance for March would be recorded as a:

Data concerning the direct labor costs for March of Boler Corporation appear below: The journal entry to record the incurrence of direct labor costs in March would include the following for Work in Process:

Cafferty Corporation has provided the following data concerning its direct labor costs for March: -The Labor Rate Variance for March would be recorded as a:

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

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 Price Variance for March would be recorded as a:

Miolen Corporation has provided the following data concerning its direct labor costs for June: The Labor Efficiency Variance for June would be recorded as a:

If the actual quantity of materials used is less than the standard quantity of materials allowed for the actual output, then the journal entry to record the Direct Materials Quantity Variance would be a debit.

A favorable materials quantity variance would appear as a credit in a journal entry.

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 credits to the Raw Materials account for March would total:

Ungvarsky Corporation has provided the following data concerning its most important raw material, compound J38F: The raw material was purchased on account. Required: a. Record the purchase of the raw material in a journal entry. b. Record the use of the raw material in production in a journal entry.