   Chapter 22, Problem 22.5BPE

Chapter
Section
Textbook Problem

Standard cost journal entriesDvorak Company produced 1,000 units that require five standard pounds per unit at $2.50 standard price per pound. The company actually used 4,500 pounds in production. Journalize the entry to record the standard direct materials used in production. To determine Standard cost: In the accounting records, the term standard cost refers to the practice of replacement of an expected cost for an actual cost. Then the difference between the expected costs, and actual costs showing the variance are also recorded periodically. A standard costs is also known as target cost or predetermined cost. To journalize: The entry to record the standard direct materials used in production. Explanation Journalize the entry to record the standard direct materials used in production.  Date Accounts and Explanation Debit ($) Credit ($) Work in process (5,000 lb (1)×$2.50) 12,500 Direct materials quantity variance (2) 1,250 Materials    (3) 11,250 (Received cash dividend)

Table (1)

Working notes:

Standard quantity = No of units required ×Standard pounds per unit= 1,000 units × £5=5,000lb (1)

[Direct materials quantity va

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