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In reviewing activity for July, the controller of Mathis, Inc., collected the following data concerning direct materials. Actual production 103,000 units Direct materials purchased (actual)

In reviewing activity for July, the controller of Mathis, Inc., collected the following data concerning direct materials.

Actual production 103,000 units
Direct materials purchased (actual) $ 1,642,800
Standard cost of materials purchased 1,554,000
Standard direct materials costs per unit produced 14
Standard price times actual amount of materials used 1,405,950

Assume that Mathis Company had no beginning finished goods inventory and only produced one product. Mathis sold 90,640 units during the period.

Required: a. Assume Mathis writes off all variances to Cost of Goods Sold. Prepare the entries Mathis would make to record and close out the variances. b. Assume Mathis prorates all variances to the appropriate accounts. Prepare the entries Mathis would make to record and close out the variances.

Journal entry worksheet

Record the standard cost of materials used and the materials efficiency variance.

Note: Enter debits before credits.

Event General Journal Debit Credit
1

Journal entry worksheet

Record the cost of the direct materials purchased and the materials price variance.

Note: Enter debits before credits.

Event General Journal Debit Credit
2

Journal entry worksheet

Record the closure of direct material cost variances to Cost of Goods Sold.

Event General Journal Debit Credit
3

Record the standard cost of materials used and the materials efficiency variance.

Note: Enter debits before credits.

Event General Journal Debit Credit
1

Record the cost of the direct materials purchased and the materials price variance.

Note: Enter debits before credits.

Event General Journal Debit Credit
2

Record the closure of direct material cost variances to Cost of Goods Sold and Finished Goods Inventory.

Note: Enter debits before credits.

Event General Journal Debit Credit
3

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