Question
Nyman Painting Contractors specializes in providing painting services to support residential remodeling projects. Nyman bids jobs based on the following cost assumptions: 1 gallon of
Nyman Painting Contractors specializes in providing painting services to support residential remodeling projects. Nyman bids jobs based on the following cost assumptions:
1 gallon of paint will cover 450 square feet of interior wall space.
300 square feet can be painted in 1 hour.
1 gallon of paint costs $25.
1 hour of direct labor costs $17.
The Sanchez residence was recently repainted. The job consisted of 18,000 square feet of interior wall space. Nyman received a $1 per gallon discount, and a total of $984 was expended for paint. Nyman paid $1,107 for direct labor. The painters took exactly 61.5 hours to paint the residence.
(a) Calculate variances for direct material and direct labor.
(b) | Prepare journal entries to record the acquisition and utilization of materials and labor (variances are recorded into the accounts). |
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