During $2020,$ The Chen Corporation had the following actual results:

Thing One Thing Two

Finished Units: Units Completed and Sold $65,00040,000$

$($Assume the sales price per unit was the same as the amount budgeted in your Operating Budget in the Chapter $6$ Computer Problem$)$

$($Assume there were no units in beginning inventory of finished goods$)$

$($Assume that work$-$in$-$process was negligible$)$

Material purchased:

A $700,000$ lbs$.$ purchased at $$9,030,000$

B $490,000$ lbs$.$ purchased at $3,871,000$

C $150,000$ purchased at $1,012,500$

$($Assume there were no materials in beginning inventory$)$

Material used:

A $690,000$ lbs$.$

B $480,000$ lbs$.$

C $130,000$ each

Direct Labor:

Thing One$-$ Actual direct labor hours used $275,000$ at $$3,492,500$

Thing Two$-$ Actual direct labor hours used $210,000$ at $$3,769,500$

Factory Overhead:

Actual Variable Factory Overhead$-$ $$3,267,500$ Thing One

Actual Variable Factory Overhead$-$ $$2,499,000$ Thing Two

Actual Fixed Factory Overhead $-$ $$4,173,000$

The following relates to the standards set by Chen:

Direct Materials and Direct Labor:

The standard inputs allowed for Direct Materials and Direct Labor and the standard price per pound and Direct Labor Hour are the same as they were when preparing Chen Corporations Operating Budget in Chapter $6.$

Factory Overhead:

Budgeted Fixed Cost $$4,168,000.$ The denominator volume is based on the direct labor hours you computed in the Direct Labor Portion of the Operating Budget in Chapter $6.$

Total Standard Overhead cost per hour $$20.($Includes variable and fixed$).$ You will need to determine what portion of the $$20$ is fixed factory overhead cost and which portion of the $$20$ is variable factory overhead cost. This is discussed in the Fixed overhead and journal entries in Module $8.$

Required: $1.$ Compute the Direct Material Price Variances for Materials A$,$ B and C and

Record the required Journal entries. Record one entry for each Material.

$($Assume the Material Price Variances is computed when the material is

purchased$).$