The Bartlesville plant of Harmon Company produces an industrial chemical. At the beginning of the year, the Bartlesville plant had the following standard cost sheet:

The Bartlesville plant computes its overhead rates using practical volume, which is 72,000 units. The actual results for the year are as follows:

a. Units produced: 70,000.

b. Direct materials purchased: 744,000 pounds at $1.50 per pound.

c. Direct materials used: 736,000 pounds.

d. Direct labor: 56,000 hours at $17.90 per hour.

e. Fixed overhead: $214,000.

f. Variable overhead: $175,400.
Required:
1. Compute price and usage variances for direct materials.
2. Compute the direct labor rate and labor efficiency variances.
3. Compute the fixed overhead spending and volume variances. Interpret the volume variance.
4. Compute the variable overhead spending and efficiency variances.
5. Prepare journal entries for the following:LO1

Transcribed Image Text:

Direct materials (10 lbs. @ $1.60) Direct labor (0.75 hr. @ $18.00) $16.00 13.50 Fixed overhead (0.75 hr. @ $4.00) 3.00 Variable overhead (0.75 hr. @ $3.00) Standard cost per unit 2.25 $34.75