Atlace Manufacturers Uses Standard Costing System

Multiple Choice

Atlace Manufacturers uses standard costing system. Standards for direct materials are as follows: Actual purchases of materials for the current month are 10,000 pounds for $48,000. Planned and actual production for the month is 3,000 units. Atlace has issued 10,000 pounds of raw materials to production. The journal entry to record this transaction would be to:

A) a debit to Work-in-Process Inventory for $28,800, a credit to Raw Materials Inventory for $30,000, a debit to Direct Materials Efficiency Variance for $1,200.
B) a debit to Work-in-Process Inventory for $28,800, a credit to Raw Materials Inventory for $50,000, a debit to Direct Materials Efficiency Variance for $28,750.
C) a debit to Work-in-Process Inventory for $30,000, a credit to Raw Materials Inventory for $50,000, a debit to Direct Materials Efficiency Variance for $20,000.
D) a debit to Work-in-Process Inventory for $50,000, a credit to Raw Materials Inventory for $48,000, a credit to Direct Materials Efficiency Variance for $50,000.