Assessment 4 Part 1: Standard Cost Summary and Related Journal Entries
						The normal capacity of Central Manufacturing Company is 45,000 direct labor hours and 20,000 units per month. A finished unit requires 6 pounds of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled 41,800 direct labor hours at an average rate of $9.50 an hour. The plant produced 18,000 units, using 105,000 pounds of materials at a cost of $2.04 per pound.
Using this spreadsheet, prepare (a) a standard cost summary showing standard unit cost, and (b) journal entries to charge materials and labor to work-in-process.
Standard Cost Summary
Materials (6 lbs. @ $2.00 per lb.):
Labor:
Factory overhead:
Standard cost per unit:
Work in Process : Materials
Materials Price Variance (U)
Materials Quantity Variance (F)
Materials
Work in Process : Labor
Labor Efficiency Variance (F)
Labor Rate Variance (F)
Payroll

Assessment 4 Part 1: Standard Cost Summary and Related Journal Entries
						The normal capacity of Central Manufacturing Company is 45,000 direct labor hours and 20,000 units per month. A finished unit requires 6 pounds of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled 41,800 direct labor hours at an average rate of $9.50 an hour. The plant produced 18,000 units, using 105,000 pounds of materials at a cost of $2.04 per pound.
Using this spreadsheet, prepare (a) a standard cost summary showing standard unit cost, and (b) journal entries to charge materials and labor to work-in-process.
Standard Cost Summary
Materials (6 lbs. @ $2.00 per lb.):
Labor:
Factory overhead:
Standard cost per unit:
Work in Process : Materials
Materials Price Variance (U)
Materials Quantity Variance (F)
Materials
Work in Process : Labor
Labor Efficiency Variance (F)
Labor Rate Variance (F)
Payroll