Slick Corporation is a small producer of synthetic motor oil. During May, the company produced 5,000 cases of lubricant. Each case contains 12 quarts of synthetic oil. To achieve this level of production, Slick purchased and used 16,500 gallons of direct materials at a cost of $20,113. It also incurred average direct labor costs of $14 per hour for the 3,902 hours worked in May by its production personnel. Manufacturing overhead for the month totaled $9,647, of which $2,200 was considered fixed. Slick's standard cost information for each case of synthetic motor oil is as follows Direct materials standard price Standard quantity allowed per case Direct labor standard rate Standard hours allowed per case 1.30 per gallon 3.25 gallons $ 16 per hour 0.75 direct labor hours Fixed overhead budgeted Normal level of production Variable overhead application rate Fixed overhead application rate ($2,6ee5,200 cases) .50 per case Total overhead application rate $2,600 per month $ 1.50 per case $2.00 per case 5,200 cases per month Required a. Compute the materials price and quantity variances. b. Compute the labor rate and efficiency variances. c. Compute the manufacturing overhead spending and volume variances. d. Prepare the journal entries to: 1. Charge materials (at standard) to Work in Process. 2. Charge direct labor (at standard) to Work in Process. 3. Charge manufacturing overhead (at standard) to Work in Process. 4. Transfer the cost of the 5,000 cases of synthetic motor oil produced in May to Finished Goods. 5. Close any over-or underapplied overhead to cost of goods sold. search 5. Close any over- or underapplied overhead to cost of goods sold Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Compute the manufacturing overhead spending and volume variances. (Indicate the effect of each va "Favorable" or "unfavorable". Select "None" and enter "O" for no effect (i.e., zero variance)). 453 Favorable Overhead spending variance $ Overhead volume variance Unfavorable Required B Required D > K Prev 4 of 4 Next here to search Slick Corporation is a small producer of synthetic motor oil. During May, the company produced 5,000 cases of lubricant. Each case contains 12 quarts of synthetic oil. To achieve this level of production, Slick purchased and used 16,500 gallons of direct materials at a cost of $20,113. It also incurred average direct labor costs of $14 per hour for the 3,902 hours worked in May by its production personnel. Manufacturing overhead for the month totaled $9,647, of which $2,200 was considered fixed. Slick's standard cost information for each case of synthetic motor oil is as follows. 1.30 per gallon Direct materials standard price Standard quantity allowed per case Direct labor standard rate 3.25 gallons Standard hours allowed per case Fixed overhead budgeted Normal level of production Variable overhead application rate Fixed overhead application rate ($2,6e8 +5,2ee cases) .58 per case Total overhead application rate $ 16 per hour $2,600 per month 1.50 per case 0.75 direct labor hours 5,200 cases per month $2.00 per case Required: a. Compute the materials price and quantity variances b. Compute the labor rate and efficiency variances. c. Compute the manufacturing overhead spending and volume variances d. Prepare the journal entries to: 1. Charge materials (at standard) to Work in Process. 2. Charge direct labor (at standard) to Work in Process 3. Charge manufacturing overhead (at standard) to Work in Process. 4. Transfer the cost of the 5,000 cases of synthetic motor oil produced in May to Finished Goods. 5. Close any over- or underapplied overhead to cost of goods sold. K Prev 4 of 4l Next > to search Required A Required B Required C | Required D Prepare the journal entries to: 1. Charge materials (at standard) to Work in Process. 2. Charge direct labor (at standard) to Work in Process. 3. Charge manufacturing overhead (at standard) to Work in Process. 4. Transfer the cost of the 5,000 cases of synthetic motor oil produced in May to Finished Goods. 5. Close any over- or underapplied overhead to cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Show less Transactiorn General J Debit Materials quantity variance 325 21,125 1.337 20,113 Work in process inventory 60,000 2,432 54,628 K Prev4 of 4 Next> ere to search 1.337 20,113 Materials price variance Work in process inventory 60,000 2,432 7,804 54,628 Work in Overhead volume variance 453 9,647 goods inventory 453 Cost of goods sold Required C
