Begin by journalizing the purchase of direct materials on account, including the related variance. (Prepare a single compound journal entry.) Standards: 3 yards of cloth per unit at $1.00 per yard...

Begin by journalizing the purchase of direct materials on account, including the related variance. (Prepare a single compound journal entry.)

Standards:

3 yards of cloth per unit at $1.00 per yard

2 direct labor hours per unit at $18.50 per hour

Overhead allocated at $6.00 per direct labor hour

Actual:

2,400 yards of cloth were purchased at $1.05 per yard

Employees worked 1,700 hours and were paid $18.00 per hour

Actual variable overhead was $3,800

Actual fixed overhead was $6,600

Data Table

Direct materials cost variance	$120 U
Direct materials efficiency variance	600 F
Direct labor cost variance	850 F
Direct labor efficiency variance	5,550 F
Variable overhead cost variance	1,400 U
Variable overhead efficiency variance	1,400 F
Fixed overhead cost variance	1,000 U
Fixed overhead volume variance	2,600 F

Jun 10, 2022

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