(Variancc disposition) Dennis Erickson Manufacturing had the following vari¬ ances at year-end 2006:

a. Prepare the journal entry at December 31 to dispose of the variances, assuming that all are insignificant.

b. After posting your entiy in part (a), what is the balance in Cost of Goods Sold?
C. Prepare the journal entries at December 31 to dispose of the variances, assuming that all are significant.

d. After posting your entries in part (c), what are the balances in each in¬ ventory account and in Cost of Goods Sold?LO.1

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Material price variance Material quantity variance $23,400 U 24,900 F Labor rate variance 5,250 F Labor efficiency variance 36,900 U Variable overhead spending variance 3,000 U 1,800 F 6,600 F 16,800 U Variable overhead efficiency variance Fixed overhead spending variance Volume variance In addition, the following inventory and Cost of Goods Sold account bal- ances existed at year-end 2006: Raw Material Inventory Work in Process Inventory Finished Goods Inventory Cost of Goods Sold $ 338,793 914,277 663,663 2,724,267