Given the Following Account Balances at the End of the First

Multiple Choice

Given the following account balances at the end of the first year of operations: Work in process inventory $ 90,000
Finished goods inventory 165,000
Cost of goods sold 495,000
Direct labour price variance 35,000 U
Direct labour efficiency variance 17,000 F
Assuming that variances are considered material, the entry and amount of direct labour variances allocated to the Finished Goods Inventory is:

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