The standard rate is $24 per direct labor-hour for Ace Company. In the current month, actual hours were 12,800 at an actual price of $23.50 per hour. For the output achieved, the standard direct labor-hours allowed were 12,000.

Required:

Prepare general journal entries isolating labor and efficiency variances under the following two systems assuming:

a. Work in Process Inventory is carried at standard hours allowed times standard prices.

b. Price variances are isolated when labor costs are originally journalized and efficiency variances are isolated when units are transferred to Finished Goods from Work in Process Inventory.