Closing the Balances in The Variance Accounts at the End of the Year

Yohan Company has the following balances in its direct materials and direct labor variance accounts at year$-$end:

Debit

Credit

Direct Materials Price Variance

$$13,450$

Direct Materials Usage Variance

Direct Labor Rate Variance

Direct Labor Efficiency Variance

$$1,100$

$870$

$$12,340$

Unadjusted Cost of Goods Sold equals $$1,500,000,$ unadjusted Work in Process equals $$236,000,$ and unadjusted Finished Goods equals $$180,000.$

Required:

Assume that the ending balances in the variance accounts are immaterial and prepare the journal entries to close them to Cost of Goods Sold. Note: Close the variances with a debit balance first. If an amount box does not require an entry, leave it blank or enter $"0".$

What if any ending balance in a variance account that exceeds $$10,000$ is considered material? $($a$)$ Close the immaterial variance Goods on the Cost of Goods Sold. $($b$)$ Prorate the largest of the labor variances among Cost of Goods Sold, Work in Process, and Finished cost in Work in Process is $$165,200,$ and the prime costs in these accounts. The prime cost in Cost of Goods Sold is $$1,050,000,$ the prire it blank or enter $"0".$

Round all interim calculations to four decimal places, and round your final answers to the nearest dollar.

$($a$)$

$($c$)$

$($b$)$

c$)$

$$nanthonk

What are the adjusted balances in Work in Process, Finished Goods, and Cost of Goods Sold after closing out all variances?

Adjusted balance

Work in Process

$

Finished Goods

$

Cost of Goods Sold

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