Del Company’s standard cost accounting system recorded this information from its June operations.

Standard direct materials cost . . . . . . . . . . . . . . . . . . . . . $260,000

Direct materials quantity variance (favorable) . . . . . . . 10,000

Direct materials price variance (favorable) . . . . . . . . . . 3,000

Actual direct labor cost . . . . . . . . . . . . . . . . . . . . . . . . . 130,000

Direct labor efficiency variance (favorable) . . . . . . . . . . 6,000

Direct labor rate variance (unfavorable) . . . . . . . . . . . . 1,000

Actual overhead cost . . . . . . . . . . . . . . . . . . . . . . . . . . . 500,000

Volume variance (unfavorable) . . . . . . . . . . . . . . . . . . . 24,000

Controllable variance (unfavorable) . . . . . . . . . . . . . . . 16,000

Required

1. Prepare journal entries dated June 30 to record the company’s costs and variances for the month. (Do not prepare the journal entry to close the variances.)

Analysis Component

2. Identify the areas that would attract the attention of a manager who uses management by exception. Describe what action(s) the manager should consider.