Atlantic Manufacturing Company Uses Standard Costing Methodology in Their Journal

Multiple Choice

Atlantic Manufacturing Company uses standard costing methodology in their journal entries and accounts. Standards for manufacturing overhead are as follows:
$$\begin{array} { l l } \text { Variable overhead: } & \$ 30 \text { per direct labor hour } \\\text { Fixed overhead: } & \$ 10 \text { per direct labor hour }\end{array}$$
Actual overhead incurred (variable and fixed) : $45,600
Other data provided:
Standards for direct labor are as follows:
Hours per unit 0.5 Price per hour $18.00
Actual direct labor for the month: 1,200 hours for a total cost of $24,000
Planned production for the month: 3,000 units
The journal entry to allocate overhead (both variable and fixed) to production would be to:

A) debit WIP $60,000, credit Manufacturing overhead $60,000.
B) debit WIP $45,600, credit Manufacturing overhead $45,600.
C) debit WIP $60,000, credit Manufacturing overhead $45,600, credit Variable overhead efficiency variance $14,400.
D) debit WIP $45,600, credit Manufacturing overhead $60,000, debit Variable overhead efficiency variance $14,400.