Use the Following Information for the Next 5 Questions

Multiple Choice

Use the following information for the next 5 questions.
Mason, Inc. uses a standard costing system. Overhead costs are allocated based on direct labor hours. The standard variable overhead and fixed overhead rates are $1 and $5 per direct labor hour, respectively. Data relevant for the current period include:
-Given the following account balances at the end of the first year of operations: Assuming that variances are considered material, the entry and amount of direct labor variances allocated to the Finished Goods Inventory is

A) Credit $3,740
B) Debit $2,160
C) Credit $770
D) Debit $3,960