A manufacturer used $60,000 of indirect materials in production. The journal entry to record this transaction includes a Multiple Choice Debit to Raw Materials Inventory for $60,000 Credit to Raw Materials Inventory for $60,000 Credit to Factory Overhead for $60,000 Debit to Work in Process Inventory for $60,000 Credit to Work in Process Inventory for $60,000
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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