Question

Assessment 4 Part 1: Standard Cost Summary and Related Journal Entries The normal capacity of Central...

Assessment 4 Part 1: Standard Cost Summary and Related Journal Entries
The normal capacity of Central Manufacturing Company is 45,000 direct labor hours and 20,000 units per month. A finished unit requires 6 pounds of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled 41,800 direct labor hours at an average rate of $9.50 an hour. The plant produced 18,000 units, using 105,000 pounds of materials at a cost of $2.04 per pound.
Using this spreadsheet, prepare (a) a standard cost summary showing standard unit cost, and (b) journal entries to charge materials and labor to work-in-process.
Standard Cost Summary
Materials (6 lbs. @ $2.00 per lb.):
Labor:
Factory overhead:
Standard cost per unit:
Work in Process : Materials
Materials Price Variance (U)
Materials Quantity Variance (F)
Materials
Work in Process : Labor
Labor Efficiency Variance (F)
Labor Rate Variance (F)
Payroll
Assessment 4 Part 1: Standard Cost Summary and Related Journal Entries
The normal capacity of Central Manufacturing Company is 45,000 direct labor hours and 20,000 units per month. A finished unit requires 6 pounds of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled 41,800 direct labor hours at an average rate of $9.50 an hour. The plant produced 18,000 units, using 105,000 pounds of materials at a cost of $2.04 per pound.
Using this spreadsheet, prepare (a) a standard cost summary showing standard unit cost, and (b) journal entries to charge materials and labor to work-in-process.
Standard Cost Summary
Materials (6 lbs. @ $2.00 per lb.):
Labor:
Factory overhead:
Standard cost per unit:
Work in Process : Materials
Materials Price Variance (U)
Materials Quantity Variance (F)
Materials
Work in Process : Labor
Labor Efficiency Variance (F)
Labor Rate Variance (F)
Payroll
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Standard Cost Summary
Materials (6 lbs. @ $2.00 per lb.): $12
Labor: (2.25 hours @$10 per hour 22.5
Factory overhead (2.25 hours $.9) 2.025
Standard cost per unit: $36.53
Work in Process : Materials
Materials Price Variance (U) 4200 U
(AQ*AR)-(AQ*Sr)
(105000*2.04)-(105000*2)
Materials Quantity Variance (F) 6000 F
SR*(AQ-SQ allowed) -6000
2*(105000-(18000*6))
Material (105000*2.04) 214200
Work in Process : Labor
Labor Efficiency Variance (F)
SR*(AH-SH allowed)
10*(41800-(18000*2.25)) 13000 U
Payroll (41800*9.5) 37620
Labor rate variance
(AH*AR)-(AH*Sr) 20900 F
(41800*9.5)-(41800*10) -20900
No. of hours
labor 45000/20000 2.250
Ans 2 Journatl entry
Dr Cr
Raw material Inventory (105000*2) 210000
Material Price Variance 4200
Accounts Payable (105000*2.04) 214200
Work in process Inventory (18000*6*2) 216000
Materials Quantity Variance 6000
Raw material Inventory 210000
Work in process Inventory (18000*2.25*10) 405000
Labor Efficiency Variance 13000
Labor rate Variance 20900
Wages payable (41800*9.5) 397100
Work in process 37620
Factory overhead 37620
(41800*.9)
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Standard Unit Cost and Journal Entries The normal capacity of Algonquin Adhesives Inc. is 40,000 direct...
Standard Unit Cost and Journal Entries The normal capacity of Algonquin Adhesives Inc. is 40,000 direct labor hours and 20,000 units per month. A finished unit requires 6 lb of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10.00 per hour. The plant estimates that overhead (all variable) for a month will be $40,000. During the month of March, the plant totaled 34,800 direct labor hours at an average rate of $9.50 an...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 2.0 pounds $ 7.00 per pound Direct labor 1.6 hours $ 14.00 per hour Variable overhead 1.6 hours $ 2.00 per hour In January the company produced 4,600 units using 10,220 pounds of the direct material and 2,200 direct labor-hours. During the month, the company purchased 10,790 pounds of the direct material at a cost of $76,670. The actual direct...
1) Pardoe Inc., manufactures a single product in which variable manufacturing overhead is assigned on the...
1) Pardoe Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard Quantity Standard Price or Rate Standard Cost Direct materials 1.5 pounds $3.00 per pound $4.50 Direct labor 0.6 hours $6.00 per hour $3.60 Variable manufacturing overhead 0.6 hours $1.25 per hour $0.75 During March, the following activity was recorded by...
1. The standard materials cost to produce 1 unit of Product R is 6 pounds of...
1. The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. What is the direct materials quantity variance? 2. The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds...
Your Company manufactures a single product. The company uses a standard cost system and has established...
Your Company manufactures a single product. The company uses a standard cost system and has established the following standards for one unit of product: Standard Standard Price Standard Quantity or Rate Cost per Unit Direct materials............................. 1.5 pounds $3.00 per pound $4.50 Direct labor.................................... 0.6 hours $6.00 per hour $3.60 Variable manufacturing overhead. 0.6 hours $1.25 per hour $0.75 During March, the following activity was recorded by the company: The company produced 3,000 units during the month. A total of...
Juliano Corporation uses a standard cost system in which inventories are recorded at their standard costs...
Juliano Corporation uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold. The standard cost card for the company’s only product is as follows: Inputs Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 1.5 pounds $ 6.00 per pound $ 9.00 Direct labor 0.80 hours $ 22.00 per hour 17.60 Fixed manufacturing overhead 0.80 hours $ 5.50 per hour 4.40 Total...
Bodacious Corporation produced 100 units of Product AA. The total standard and actual costs for materials...
Bodacious Corporation produced 100 units of Product AA. The total standard and actual costs for materials and direct labor for the 100 units of Product AA are as follows: Materials: ​ Standard Actual Standard: 200 pounds at $3.00 per pound $600 ​ Actual: 220 pounds at $2.85 per pound ​ $627 ​ ​ ​ ​ Direct labor: ​ ​ ​ Standard: 400 hours at $15.00 per hour 6,000 ​ Actual: 368 hours at $16.50 per hour ​ 6,072 ​ What...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 2.0 pounds $ 7.00 per pound Direct labor 0.6 hours $ 14.00 per hour Variable overhead 0.6 hours $ 6.00 per hour In January the company produced 4,600 units using 10,120 pounds of the direct material and 2,100 direct labor-hours. During the month, the company purchased 10,690 pounds of the direct material at a cost of $76,570. The actual direct...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price...
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 6.5 pounds $ 6.00 per pound Direct labor 0.8 hours $ 25.00 per hour Variable overhead 0.8 hours $ 11.50 per hour In January the company produced 3,360 units using 13,440 pounds of the direct material and 2,808 direct labor-hours. During the month, the company purchased 14,200 pounds of the direct material at a cost of $35,100. The actual direct...
The Bartlesville plant of Harmon Company produces an industrial chemical. At the beginning of the year,...
The Bartlesville plant of Harmon Company produces an industrial chemical. At the beginning of the year, the Bartlesville plant had the following standard cost sheet: Direct Materials (10 lbs. @ $1.60) $16.00 Direct Labor (0.75 hours @ $18.00) $13.50 Fixed Overhead (0.75 hours @ $4.00) $3.00 Variable Overhead (0.75 hours @ $3.00) $2.25 Standard Cost per Unit $34.75 The Bartlesville plant computes its overhead rates using practical volume, which is 72,000 units. The actual results for the year are as...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT