Exercise 11-13 Quality Cabinet Company uses a standard costing system and produc
ID: 2471280 • Letter: E
Question
Exercise 11-13 Quality Cabinet Company uses a standard costing system and produced 2,040 cabinets during May. The standard cost of wood is $22 per linear foot, and the standard quantity for each cabinet is 30 linear feet. During May, the company purchased 63,700 linear feet of wood for $1,274,000, and 62,300 feet were used in production. The company purchases all materials on account.
Determine the material price variance and the material quantity variance. (Enter all variances as a positive number.)
Record the related journal entries for May. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
1.
(To record material purchases)
2.
(To record material used in production)
Material Price Variance $ Unfavorable / Favorable / Neither Unfavorable nor Favorable Material Quantity Variance $ Favorable / Neither Unfavorable nor Favorable / UnfavorableExplanation / Answer
Material Price variance (Standard Price-Actual Price)*Actula Quantity used (62300*22-1274000/63700*62300) = 124600 F Material Quantity variance (Standard Quantity for Actual Output-Actual Quantity)*Standard Price (2040*30-62300)*22 = 24200 U Journal Entry Material A/C Dr. 1,274,000 To Cash 1,274,000 (Material Purchase) Work in precess A/C dr. 1,246,000 To Material A/C 1,246,000 (Material Issue for Production
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.