Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Direct Materials and Direct Labor Variances Berner Company produces a dark chocolate candy bar. Recently, the company adopted the following standards for one bar of

image text in transcribedimage text in transcribed

Direct Materials and Direct Labor Variances Berner Company produces a dark chocolate candy bar. Recently, the company adopted the following standards for one bar of the candy: Direct materials (8.30 oz. @ $0.09) $0.75 Direct labor (0.09 hr. @ $18.00) 1.62 Standard prime cost $2.37 During the first week of operation, the company experienced the following actual results: a. Bars produced: 142,000. b. Ounces of direct materials purchased: 1,178,900 ounces at $0.08 per ounce. c. There are no beginning or ending inventories of direct materials. d. Direct labor: 12,640 hours at $17.20. Required: Instructions for parts 1 and 2: If a variance is zero, enter "O" and select "Not applicable" from the drop down box. 1. Compute price and usage variances for direct materials. Materials Price Variance Favorable Materials Usage Variance Unfavorable 2. Compute the rate variance and the efficiency variance for direct labor. Labor Rate Variance Favorable Labor Efficiency Variance Favorable 3. Prepare the journal entries associated with direct materials and direct labor. If an amount box does not require an entry, leave it blank. Materials Direct Materials Price Variance Accounts Payable Record purchase of materials Work in Process Direct Materials Usage Variance Materials 1101 11 Record usage of materials 110 111 Work in Process Direct Labor Rate Variance Direct Labor Efficiency Variance Wages Payable Record labor variances

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cornerstones Of Cost Management

Authors: Don R. Hansen, Maryanne M. Mowen

3rd Edition

9781305147102, 1285751787, 1305147103, 978-1285751788

More Books

Students also viewed these Accounting questions