A variance analysis investigating the purchase and use of direct materials and direct labour has been completed
Question:
A variance analysis investigating the purchase and use of direct materials and direct labour has been completed and the following results are known:
Direct materials purchases:
AQ × AP: 12,000 metres @ $3.45/m = $41,400
Direct materials use:
AQ × SP: 10,500 metres @ $3.25/m = $34,125
Quantity variance: $1,625U
Direct labour:
AH × SR: $25,594
SH × SR: $25,000
Wages paid: $21,156 for 1,980 hours worked
Additional information:
Actual production........................................................................5,000 units
Direct labour hours required per standard.................0.4 hours per unit
Required:
Prepare ALL the pertinent journal entries including the entries that originate the variances.
Step by Step Answer:
Introduction to Managerial Accounting
ISBN: 978-1259105708
5th Canadian edition
Authors: Peter C. Brewer, Ray H. Garrison, Eric Noreen, Suresh Kalagnanam, Ganesh Vaidyanathan