Ozarks Camping Equipment, Inc., has established the following direct-material standards for its two products. During May, the

Question:

Ozarks Camping Equipment, Inc., has established the following direct-material standards for its two products.

During May, the company purchased 4,200 yards of tent fabric for its standard model at a cost of $ 26,880. The actual May production of the standard tent was 200 tents, and 2,500 yards of fabric were used. Also during May, the company purchased 1,600 yards of tent fabric for its deluxe backpacking tent at a cost of $ 12,640. The firm used 1,440 yards of the fabric during May in the production of 240 deluxe tents.

Required:
1. Compute the direct- material purchase price variance and quantity variance for May.
2. Prepare journal entries to record the purchase of material, use of material, and incurrence of variances inMay.