Exercise 23-22 Levine Inc., which produces a single product, has prepared the fo
ID: 2522173 • Letter: E
Question
Exercise 23-22 Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (7 pounds at $2.40 per pound) Direct labor (2 hours at $12.00 per hour) During the month of April, the company manufactures 340 units and incurs the following actual costs. Direct materials purchased and used (2,420 pounds) Direct labor (710 hours) Journalize the entries to record the materials and labor variances. (Credit account titles are automatically indented when amount is entered. $16.80 $24.00 $6,292 $8,378 Do not indent manually. Round answers to o decimal places, e.g. 125.)Explanation / Answer
Answers
Actual DATA for
340
units
Quantity (AQ)
Rate (AR)
Actual Cost
Direct Material
2420
$ 2.60
$ 6,292.00
Direct labor
710
$ 11.80
$ 8,378.00
Standard DATA for
340
units
Quantity (SQ)
Rate (SR)
Standard Cost
Direct Material
2380
$ 2.40
$ 5,712.00
Direct labor
680
$ 12.00
$ 8,160.00
Material Price Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Quantity
(
$ 2.40
-
$ 2.60
)
x
2420
-484
Variance
484
Unfavourable-U
Material Quantity Variance
(
Standard Quantity
-
Actual Quantity
)
x
Standard Rate
(
2380
-
2420
)
x
$ 2.40
-96
Variance
96
Unfavourable-U
Material Spending Variance
(
Standard Cost
-
Actual Cost
)
(
$ 5,712.00
-
$ 6,292.00
)
-580
Variance
580
Unfavourable-U
Labor Rate Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Labor Hours
(
$ 12.00
-
$ 11.80
)
x
710
142
Variance
142
Favourable-F
Labour Efficiency Variance
(
Standard Hours
-
Actual Hours
)
x
Standard Rate
(
680
-
710
)
x
$ 12.00
-360
Variance
360
Unfavourable-U
Labor Spending Variance
(
Standard Cost
-
Actual Cost
)
(
$ 8,160.00
-
$ 8,378.00
)
-218
Variance
218
Unfavourable-U
Accounts Titles
Debit
Credit
Raw material Inventory
$ 5,808.00
Material Price variance
$ 484.00
Accounts payable
$ 6,292.00
Work In Process Inventory
$ 5,712.00
Material Quantity variance
$ 96.00
Raw material Inventory
$ 5,808.00
Factory labor
$ 8,520.00
Labor Price variance
$ 142.00
Factory Wages payable
$ 8,378.00
Work In Process Inventory
$ 8,160.00
Labor Quantity Variance
$ 360.00
Factory labor
$ 8,520.00
Actual DATA for
340
units
Quantity (AQ)
Rate (AR)
Actual Cost
Direct Material
2420
$ 2.60
$ 6,292.00
Direct labor
710
$ 11.80
$ 8,378.00
Standard DATA for
340
units
Quantity (SQ)
Rate (SR)
Standard Cost
Direct Material
2380
$ 2.40
$ 5,712.00
Direct labor
680
$ 12.00
$ 8,160.00
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