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3. Prepare the journal entries associated with direct materials and direct labor. If an amount box does not require an entry, leave it blank or enter "0". Materials Direct Materials Price Variance Accounts Payable Record purchase of materials Work in Process Direct Materials Usage Variance Materials Record usage of materials Work in Process Direct Labor Rate Variance Direct Labor Efficiency Variance Wages Payable Record labor variances > > x > x x x x x > x > > >

3. Prepare the journal entries associated with direct materials and direct labor. If an amount box does not require an entry, leave it blank or enter "0". Materials Direct Materials Price Variance Accounts Payable Record purchase of materials Work in Process Direct Materials Usage Variance Materials Record usage of materials Work in Process Direct Labor Rate Variance Direct Labor Efficiency Variance Wages Payable Record labor variances > > x > x x x x x > x > > >

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 1PB: Direct materials and direct labor variance analysis Lenni Clothing Co. manufactures clothing in a...
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Direct Materials and Direct Labor Variances Zoller Company produces a dark chocolate candy bar. Recently, the company adopted the following standards for one bar of the candy: Direct materials (6.20 oz. @ $0.20) $1.24 Direct labor (0.08 hr. @ $18.00) 1.44 Standard prime cost $2.68 During the first week of operation, the company experienced the following actual results: a. Bars produced: 141,000. b. Ounces of direct materials purchased: 874,500 ounces at $0.21 per ounce. c. There are no beginning or ending inventories of direct materials. d. Direct labor: 11,140 hours at $17.30. Required: Instructions for parts and 2: If a variance is zero, enter "0" and select "Not applicable" from the drop down box. 1. Compute price and usage variances for direct materials. Materials Price Variance 8,745 Unfavorable Materials Usage Variance 60 Unfavorable 2. Compute the rate variance and the efficiency variance for direct labor. Labor Rate Variance 7,798 V Favorable Labor Efficiency Variance 2,520 V Favorable
Transcribed Image Text:Direct Materials and Direct Labor Variances Zoller Company produces a dark chocolate candy bar. Recently, the company adopted the following standards for one bar of the candy: Direct materials (6.20 oz. @ $0.20) $1.24 Direct labor (0.08 hr. @ $18.00) 1.44 Standard prime cost $2.68 During the first week of operation, the company experienced the following actual results: a. Bars produced: 141,000. b. Ounces of direct materials purchased: 874,500 ounces at $0.21 per ounce. c. There are no beginning or ending inventories of direct materials. d. Direct labor: 11,140 hours at $17.30. Required: Instructions for parts and 2: If a variance is zero, enter "0" and select "Not applicable" from the drop down box. 1. Compute price and usage variances for direct materials. Materials Price Variance 8,745 Unfavorable Materials Usage Variance 60 Unfavorable 2. Compute the rate variance and the efficiency variance for direct labor. Labor Rate Variance 7,798 V Favorable Labor Efficiency Variance 2,520 V Favorable
3. Prepare the journal entries associated with direct materials and direct labor. If an amount box does not require an entry, leave it blank or enter "0". Materials Direct Materials Price Variance Accounts Payable X Record purchase of materials Work in Process X Direct Materials Usage Variance X Materials Record usage of materials Work in Process Direct Labor Rate Variance Direct Labor Efficiency Variance X Wages Payable Record labor variances
Transcribed Image Text:3. Prepare the journal entries associated with direct materials and direct labor. If an amount box does not require an entry, leave it blank or enter "0". Materials Direct Materials Price Variance Accounts Payable X Record purchase of materials Work in Process X Direct Materials Usage Variance X Materials Record usage of materials Work in Process Direct Labor Rate Variance Direct Labor Efficiency Variance X Wages Payable Record labor variances
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