Bria manufactures coffee mugs that it sells to other companies for customizing with their own logos. Bria prepares flexible budgets and uses a standard cost system to control manufacturing costs. The standard unit cost of a coffee mug is based on static budget volume of 60,000 coffee mugs per month: (Click the icon to view the cost data.) Actual cost and production information for July 2024 follows: (Click the icon to view actual cost and production information.) Read the requirements. Data table - the icon to VIE n.) ts. Direct Materials (0.2 lbs @ $0.25 per lb) Direct Labor (3 minutes @ $0.10 per minute) $ 0.05 0.30 Manufacturing Overhead: Variable (3 minutes @ $0.04 per minute) $ 0.12 erials Fact Fixed (3 minutes @ $0.14 per minute) 0.42 0.54 Total Cost per Coffee Mug 0.89 Print Done d ident ixed ow X Ov on. nts Requirements 1. Compute the cost and efficiency variances for direct materials and direct labor. 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. 4. Journalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. 5. Bria intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? Print Done ater nd fix Requirement 1. Compute the cost and efficiency variances for direct materials and direct labor. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC actual cost: AQ = actual quantity; FOH = fixed overhead; SC standard cost; SQ standard quantity.) Formula Variance Direct materials cost variance Direct labor cost variance Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC actual cost; AQ actual quantity; FOH fixed overhead; SC standard cost; SQ= standard quantity.) Direct materials efficiency variance Direct labor efficiency variance Formula Variance Requirement 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing the purchase of direct materials, including the related variance. (Prepare a single compound journal entry.) Date Jul. Accounts and Explanation Debit Credit Now, journalize the usage of direct materials, including the related variance. (Prepare a single compound journal entry.) Date Jul. Accounts and Explanation Debit Credit Journalize the incurrance and assignment of direct labor costs, including the related variances. (Prepare a single compound journal entry.) Accounts and Explanation Date Jul. Debit Credit Requirement 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and Requirement 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost a volume variances... Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances, and identify whether each variance is favorable (F) or unfavorable (U). (Round any interim calculations to four decimal places, X.XXXX, and your final answers to the nearest whole dollar. Abbreviations used: AC actual cost; AQ = actual quantity; FOH fixed overhead; SC standard cost; SQ = standard quantity; VOH = variable overhead.) VOH cost variance VOH efficiency variance Formula Variance Now compute the fixed overhead cost and volume variances. Select the required formulas, compute the fixed overhead cost and volume variances, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ= actual quantity; FOH = fixed overhead; SC standard cost; SQ = standard quantity.) FOH cost variance Formula Variance FOH volume variance Requirement 4. Journalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing the entry to show the actual manufacturing overhead costs incurred. Date Jul. Accounts and Explanation Journalize the applied manufacturing overhead. Debit Credit Journalize the applied manufacturing overhead. Date Jul. Accounts and Explanation Debit Credit Journalize the movement of all production from Work-in-Process Inventory. Date Jul. Accounts and Explanation Debit Credit Journalize the adjusting of the Manufacturing Overhead account. (Prepare a single compound journal er Date Jul. Accounts and Explanation Debit Credit the decision wise? Hiring more-skilled, higher-paid labor led to efficiency variance, it direct labor cost variance. Given the appear that these more-skilled workers performed efficiently. The overall net effect is , thus management's decision was direct labor