Question
Saskatewan Can Company manufactures recyclable soft-drink cans. A unit of production is a case of 12 dozen cans. The following standards have been set by
Saskatewan Can Company manufactures recyclable soft-drink cans. A unit of production is a case of 12 dozen cans. The following standards have been set by the production-engineering staff and the controller.
Direct Labor: | Direct Material: |
Quantity, 0.29 hour | Quantity, 8 kilograms |
Rate, $14.50 per hour | Price, $0.68 per kilogram |
Actual material purchases amounted to 412,800 kilograms at $0.70 per kilogram. Actual costs incurred in the production of 48,000 units were as follows:
Direct labor: | $228,096 for 15,360 hours |
Direct material: | $273,840 for 391,200 kilograms |
Prepare the following journal entries. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) 1. Record the purchase of direct material on account and the direct-material purchase price variance. 2. Record the addition of direct-material cost to work-in-process inventory and the direct-material quantity variance. 3. Record the addition of direct-labor cost to work-in-process inventory and the direct-labor variances. 4. Record the closing of the direct-material and direct-labor variances to cost of goods sold. |
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