Compute labor variances; prepare journal entries (L.O. 4, 5)

The finishing department of Mozart Company produced 25,000 units during November. The standard number of direct labor-hours per unit is two hours. The standard rate per hour is $37.80. During the month, 51,250 direct labor-hours were worked at a cost of $1,742,500.

a.Compute labor variances.

b. Using T-accounts, illustrate recording the labor data in a journal entry.

c.Using T-accounts, illustrate the journal entry to dispose of any variances (close to Cost of Goods Sold).