Variances, Entries, and Income StatementA summary of Glendale Company's manufacturing variance report for May follows:Total Standard Costs $(9,200$ units$)$Actual Costs $(9,200$ units$)$VariancesDirect material$$34,040$$$37,730$$$3,690$UDirect labor$179,400178,920480$FVariable overhead$9,6609,480180$FFixed overhead$9,6609,660-$$$232,760$$$235,790$$$3,030$UStandard material cost per unit of product is $0\mathrm{.}5$ pounds at $$7\mathrm{.}40$ per pound, and standard direct labor cost is $1\mathrm{.}5$ hours at $$13\mathrm{.}00$ per hour. The total actual materials cost represents $4,900$ pounds purchased at $$7\mathrm{.}70$ per pound. Total actual labor cost represents $14,200$ hours at $$12\mathrm{.}60$ per hour. According to standards, variable overhead rate is applied at $$0\mathrm{.}70$ per direct labor hour $($based on a normal capacity of $15,000$ direct labor hours or $10,000$ units of product$).$ Assume that all fixed overhead is applied to work in progress inventory.a$.$ Determine the following variances:Do not use negative signs with any of your answers. Next to each variance answer, select either $"$F$"$ for Favorable or $"$U$"$ for Unfavorable.Materials VariancesActual cost:Answer$37,730$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Split cost:Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Standard cost:Answer$34,040$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Materials priceAnswer$37,730$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Materials efficiencyAnswer$3,810$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Labor VariancesActual cost:Answer$178,920$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Split cost:Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Standard cost:Answer$179,400$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Labor rateAnswer$178,920$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Labor efficiencyAnswer$3,120$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Variable Overhead VariancesActual cost:Answer$9,480$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Split cost:Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Standard cost:Answer$9,660$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Variable overhead spendingAnswer$460$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Variable overhead efficiencyAnswer$3,500$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerFUCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$b$.$ Prepare general journal entries to record standard costs, actual costs, and related variances for material, labor, and overhead.General JournalDescriptionDebitCreditMaterials inventoryAnswer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$37,730$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$To record the purches of direct materialsWork in process inventoryAnswer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$34,040$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$34,040$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To record the use of direct materialsWork in process inventoryAnswer$178,920$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Labor rate varianceAnswer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$480$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$3,120$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To record direct labor costs and related cost variances.Work in process inventoryAnswer$9,480$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$180$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Manufactruing overheadAnswer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$3,550$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To apply variable overhead to work in progress and record related cost variancesAnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$9,660$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$9,660$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$To apply fixed overhead to work in progressc. Prepare journal entries to record the transfer of all completed units to Finished Goods Inventory and the subsequent sale of $8,400$ units on account at $$54$ each $($assume no beginning finished goods inventory$).$General JournalDescriptionDebitCreditAnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To record completion ofunitsAnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To record sale ofunitsAnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$AnswerAccounts payableAccounts receivableCost of goods soldFinished goods inventoryLabor efficiency varianceManufacturing overheadMaterials efficiency varianceMaterials inventoryMaterials price varianceSalesVariable overhead efficiency varianceVariable overhead spending varianceWages payableWork in process inventoryCorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$To record cost ofunitsd. Prepare a partial income statement $($through gross profit on sales$)$ showing gross profit based on standard costs, the incorporation of variances, and gross profit based on actual costs.Do not use negative signs with any of your answers below.Glendale CompanyPartial Income StatementFor the Month Ended May $31$SalesAnswer$453,600$CorrectMark $1\mathrm{.}00$ out of $1\mathrm{.}00$Cost of goods at standard costAnswer$409,000$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Gross profit at standard costAnswer$44,600$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Net cost varianceMaterialAnswer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$LaborAnswer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Variable overheadAnswer$3,020$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Answer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$Gross profit at actual costAnswer$0$IncorrectMark $0\mathrm{.}00$ out of $1\mathrm{.}00$