A D E F G H | J K 1 B Standard Costing (38 marks) After graduation from the Business Accounting program at Algonquin college, you proudly accepted a well paying position as a cost accountant for Serenade Manufacturing located in London, Ontario. The following is the standard card for the company's only product: 2 3 4 5 6 per Unit 7 8 Manufacturing Costs Direct materials (metres) Direct labour (DL Hrs) Variable overhead (DL Hrs) Fixed overhead (DL Hrs) Standard cost per unit Standard Qty or Standard Price Standard Cost Hrs or Rate 4.0 $ 4.00 $ 16.00 1.5 $ 10.00 15.00 1.5 $ 3.00 4.50 1.5 $ 7.00 10.50 $ 46.00 9 10 11 12 13 22.500 Denominator activity level monthly (DL Hrs) Budgeted Fixed overhead costs monthly 14 $ 157,500 15 16 17 For the past month of February 2022, the company proudly manufactured and sold 18,165 units. Variable and fixed manufacturing overhead costs are applied to products on the basis of direct labour hours. All raw materials are direct materials, there are no indirect materials. Additional actual manufacturing results, provided from the Controller, Emily Palmer, include: 18 19 $ 20 4.20 per metre 21 22 Direct materials purchased (metres) Beginning inventory of direct materials (metres) Ending inventory of direct materials (metres) Direct labour Fixed overhead costs Variable overhead costs Metres or Hours 70,134 $ 22,100 22,000 29,316 $ $ $ 23 24 9.75 per hour 154,515 90,000 25 26 27 28 29 30 Required: Ms. Palmer has asked you to determine the following results for February 2022: 1. For direct materials: a. Price and quantity variances Price Variance 31 14,026.80 U 32 33 34 Quantity Variance $ (10.104.00 F 35 36 b. Journal entries to record activity 37 38 39 Journal Entries Dr Cr Accounts Accounts Payable Raw Materials Price Variance 40 41 42 43 To record the purchase of raw materials Work in Process Quantity Variance Raw Materials To record the usage of raw materials in production 44 45 46 47 48 49 50 51 52 53 54 55 56 2. For direct labour: a. Rate and efficiency variances Rate Variance (7,329.00) Efficiency Variance $ (20,685.00) U b. Journal entry to record labour activity Journal Entry Dr Accounts Cr 57 58 59 60 61 62 63 64 65 66 67 68 69 70 To record the Direct Labour 3. Variable overhead spending and efficiency variances Spending Variance Efficiency Variance 71 4. Fixed overhead budget and volume variances Budget Variance 72 73 74 75 76 Volume Variance 77