Question

Bliny Corporation makes a product with the following standard costs for direct material and direct labor:...

Bliny Corporation makes a product with the following standard costs for direct material and direct labor:
  Direct material: 3.00 meters at $3.10 per meter $ 9.30
  Direct labor: 0.40 hours at $12.50 per hour $ 5.00

During the most recent month, 5,300 units were produced. The costs associated with the month’s production of this product were as follows:
  Material purchased: 12,300 meters at $2.80 per meter $ 34,440
  Material used in production: 16,550 meters –
  Direct labor: 2,100 hours at $12.85 per hour $ 26,985
The standard cost variances for direct material and direct labor are:


  Materials price variance: 12,300 meters at $0.30 per meter F $ 3,690 F
  Materials quantity variance: 650 meters at $3.10 per meter U $ 2,015 U
  Labor rate variance: 2,100 hours at $0.35 per hour U $ 735 U
  Labor efficiency variance: 20 hours at $12.50 per hour F $ 250 F


Required:
1.

Prepare the journal entry to record the purchase of materials on account for the month. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)


       

2.

Prepare the journal entry to record the use of materials for the month. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

      

3.

Prepare the journal entry to record the incurrence of direct labor cost for the month. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)  

      

Business   Accounting   
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Homework Answers

Answer #1

Journal entries :

No account and explanation debit credit
1 Raw material 38130
Material price variance 3690
Account payable 34440
(To record material purchase)
2 Work in process (5300*3*3.1) 49290
Material quantity variance 2015
Raw material (16550*3.1) 51305
(To record use of material)
3 Work in process 26500
Labor rate variance 735
Labor efficiency variance 250
Wages payable 26985
(To record labor)
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