Refer to the information in PA10-1 for Drink Well.

Required:

Prepare the journal entry to record the following for Drink Well:

1. Direct materials costs and related variances. Assume the company purchases raw materials as needed and does not maintain any ending inventories.

2. Direct labor and related variances.

3. Variable overhead costs and related variances.

Data from PA10-1

Drink Well, Inc., manufactures custom-ordered commemorative beer steins. Its standard cost information follows:

Drink Well had the following actual results last year:

Transcribed Image Text:

Direct costs Clay Direct labor Variable MOH Fixed MOH ($250,000/100,000 units) Standard Quantity Standard Price (Rate) Standard Unit Cost 1.5 lbs. $ 1.60 per lb. $ 2.40 1.5 hrs. 12.00 per hr. 18.00 1.20 per direct labor hour 1.80 2.50