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 $13,950 Direct Materials Usage Variance $1,200 Direct Labor Rate Variance 820 Direct Labor Efficiency Variance $12,640 Unadjusted Cost of Goods Sold equals $1,560,000, unadjusted Work in Process equals $296,000, and unadjusted Finished Goods equals $180,000 Required: 1. 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" Close variances with debit balance 8 Close variances with credit balance eBook Ch. 9 (Part 1) Homework Assignme Print tem What is the adjusted balance in Cost of Goods Sold after closing out the out the variances? 2. What if any ending balance in a variance account that exceeds $12,000 is considered material? (a) Close the immaterial variance accounts to cost of Goods Sold. (b) Prorate the largest of the labor variances among Cost of Goods Sold, Work in Process, and Finished Goods on the basis of prime costs in these accounts. (c) Prorate the largest of the material variances among Cost of Goods Sold, Work in Process, and Finished Goods on the basis of prime costs in these accounts. The prime cost in Cast of Goods Sold is $1,050,000, the prime cost in Work in Process is $161,600, and the prime cost in Finished Goods is $129,000. 17 an amount box does not require an entry, leave it blank or enter *o. Note: Round all interim calculations to three decimal places, and round your final answers to the nearest dollar. Adjust credit entry for rounding to ensure debits equal credits in journal entry. (a) (b) HII IIII III. II III III. (c) 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 Reciprocal Method of Support Department Cost Allocation Vairon Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly Support Producing Departments Departments Human General Resources Factory Fabricating Assembly Direct costs $150,000 $350,000 $114,800 $95,000 Normal activity: Number of 60 80 employees 170 Square footage 1,000 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Now assume that Valron Company uses the reciprocal method to allocate support department costs Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the reciprocal method. If an amount is zero, enter"0" Use the rounded values for subsequent calculations. Proportion of Driver Used by Human General Resources Factory Fabricating Assembly Human O 0.32 0.68 Resources General Factory 0 0.68 0.70 2. Develop a simultaneous equations system of total costs for the support departments. If required, round your answers to four decimal places. Use these numbers for subsequent calculations. If required, round all other intermediate calculations to six decimal places, except the answers computed in requirement 1. Human Resources 150,000 (HR) (GF) General Factory (GF) (HR) Solve for the total reciprocated costs of each support department. (Round reciprocated total costs to the nearest dollar) Human Resources (HR) General Factory (GF) + + 3. Using the reciprocal method, alocate the costs of the Human Resources and General Tectory departments to the fabricating and Assembly departments Round alocated costs to the nearest doar 19 an amount is rero, entero. Note: There may be a'51" ofference due to imediat rounding Support Departments Producing Departments Human General Resources Factory Fabricating Assembly Direct costs Allocata Human Resources General Factory Totalar allocation