The Sunnyville plant of the Hart Company produces and sells an industrial chemical. At the beginning of the year, the Sunnyville plant had the following planned budget (standards) per output (chemical):

Direct Materials (10 lbs @ $1.60 per pound)

Direct Labor (0.75 hours @ $18.00)

The actual results for the year are as follows:

Units Produced: 70,000 units

Direct Materials Purchased and Used: 736,000 lbs. @ $1.50 per pound

Direct Labor: 56,000 hours @ $17.90 per hour

a. Compute the price and quantity variances for Direct Materials:

b. Compute the rate and efficiency variances for Direct Labor:

c. Prepare journal entries for all variances:

Direct materials price variance:

Direct materials quantity variance:

Direct labor rate and efficiency variance:

d. Prepare journal entries to write-off variances to COGS:

Direct materials and direct labor: