Pina, Inc. is known throughout the world for its H2O-X high-capacity water pump, used in irrigation systems. The company uses a standard costing system, and the pumps standard cost is as follows. The companys predetermined fixed overhead rate is based on an expected capacity of 120,000 direct labor hours per month.

		Standard Price		Standard Quantity		Standard Cost
Direct materials		$5 per pound		15 pounds			$75
Direct labor		$9 per DLH		5 DLH			45
Variable overhead		$9 per DLH		5 DLH			45
Fixed overhead		$6 per DLH		5 DLH			30
							$195

During the month of September, the company produced 20,800 of the 24,000 pumps that had been scheduled for production in the budget. The company used 367,000 pounds of material during September. The direct labor payroll for the month was $1,105,100 for 110,510 direct labor hours. Variable overhead costs were $982,390; fixed overhead costs were $755,300. The companys purchasing agent signed a new supply contract that resulted in purchases of 480,000 pounds of direct materials at a price of $2,160,000. (a) Prepare the journal entries to record the purchase and use of direct materials during September. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.	Account Titles and Explanation	Debit	Credit
1.	enter an account title to record the purchase of material	enter a debit amount	enter a credit amount
	(To record the purchase of material)
2.	enter an account title to record the use of material	enter a debit amount	enter a credit amount
	(To record the use of material)

(b) Prepare the journal entry to record the use of direct labor during September. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To record direct labor)

(c) Prepare the journal entry to record actual variable overhead costs incurred. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To record actual variable manufacturing overhead)

(d) Prepare the journal entry to record the application of variable overhead to production. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To record applied variable manufacturing overhead)

(e) Prepare the journal entry to record actual fixed overhead costs incurred. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To record actual fixed manufacturing overhead)

(f) Prepare the journal entry to record the application of fixed overhead to production. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To record applied fixed manufacturing overhead)

(g) Prepare the journal entries to record the variable and fixed overhead variances. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.	Account Titles and Explanation	Debit	Credit
1.	enter an account title to record variable overhead variances	enter a debit amount	enter a credit amount
	(To record variable overhead variances)
2.	enter an account title to record fixed overhead variances	enter a debit amount	enter a credit amount
	(To record fixed overhead variances)

(h) Prepare the journal entry to close all variances to Cost of Goods Sold. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
(To close variances to Cost of Goods Sold)