Question: Execucraft Inc manufactures upholstered office chairs The standard cost for

Execucraft, Inc., manufactures upholstered office chairs. The standard cost for material and labor is $ 89.20 per chair. This includes 8 kilograms of direct material at a standard cost of $ 5.00 per kilogram, and 6 hours of direct labor at $ 8.20 per hour. The following data pertain to September.
Units completed: 5,600 chairs.
Purchases of materials: 50,000 kilograms for $ 249,250.
Total actual labor costs: $ 300,760.
Actual hours of labor: 36,500 hours.
Direct-material quantity variance: $ 1,500 unfavorable.
Work-in-process inventory on September 1: none.
Work-in-process inventory on September 30: 800 chairs (75 percent complete as to labor; material is issued at the beginning of processing).

1. Compute the following amounts. Indicate whether each variance is favorable or unfavorable.
a. Direct- labor rate variance for September.
b. Direct- labor efficiency variance for September.
c. Actual kilograms of material used in the production process during September.
d. Actual price paid per kilogram of direct material in September.
e. Total amounts of direct-material and direct-labor cost transferred to Finished-Goods Inventory during September.
f. The total amount of direct-material and direct-labor cost in the ending balance of Work-in-Process Inventory at the end of September.
2. Prepare journal entries to record the following:
a. Purchase of raw material.
b. Adding direct material to Work-in-Process Inventory.
c. Adding direct labor to Work-in-Process Inventory.
d. Recording of variances.
(CMA, adapted)

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