Question
James Company manufactures t-shirts. During the year, it manufactured 250,000 t-shirts, using 2 hours of direct labor at a rate of $8.50 per hour. The
James Company manufactures t-shirts. During the year, it manufactured 250,000 t-shirts, using 2 hours of direct labor at a rate of $8.50 per hour. The materials and labor standards for manufacturing the t-shirts are:
Direct materials (6 yards of fabric @ $3 per yard) | $18 |
Direct labor (2.4 hours @ $8.00 per hour) | 17 |
It took James 1,400,000 yards at $2.50 per yard to make the 250,000 t-shirts.
What is the entry to record the purchase of materials?
a. | debit Materials, 4,200,000 debit Materials Price Variance, 750,000 credit Accounts Payable, 4,950,000 | |
b. | debit Materials, 4,200,000 credit Materials Price Variance, 700,000 credit Accounts Payable, 3,500,000 | |
c. | debit Materials, 3,500,000 credit Materials Price Variance, 700,000 credit Accounts Payable, 4,200,000 | |
d. | debit Materials, 3,500,000 debit Materials Price Variance, 750,000 credit Accounts Payable, 4,250,000 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started