Review the results from Exercises E23- 18 and E23- 21. Record the journal entries to record direct materials, direct labor, variable overhead, and fixed overhead, ­assuming all expenditures were on account and there were no beginning or ending balances in the inventory accounts ( all materials purchased were used in production and all goods produced were sold). Record the journal entries to record the transfer to Finished Goods Inventory and Cost of Goods Sold. Adjust the Manufacturing Overhead account.

In E23- 18

Premium, Inc. produced 1,000 units of the company’s product in 2014. The stan-dard quantity of direct materials was three yards of cloth per unit at a standard cost of $ 1.05 per yard. The accounting records showed that 2,600 yards of cloth were used and the company paid $ 1.10 per yard. Standard time was two direct labor hours per unit at a standard rate of $ 9.75 per direct labor hour. Employees worked 1,400 hours and were paid $ 9.25 per hour.

In E23- 21

Static budget variable overhead.......... $ 1,600

Static budget fixed overhead ..........$ 3,200

Static budget direct labor hours ..........1,600 hours

Static budget number of units ..........800 units