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DM variances; journal entries Skip Company produces a product called Lem. The standard direct material cost to produce one unit of Lem is four quarts of raw material at $2.50 per quart. During May, 4,200 quarts of raw material were purchased at a cost of $10,080. All the purchased material was used to produce 1,000 units of Lem. a. Compute the material price variance and material quantity variance for May. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 b. Assume the same facts except that Skip Company purchased 6,000 quarts of material at the previously calculated cost per quart, but used only 4,200 quarts. Compute the material price variance and material quantity variance for May, assuming that Skip identifies variances at the earliest possible time. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 c. Prepare the journal entries to record the material price and usage variances calculated in (b). Note: List any multiple debits or any multiple credits in alphabetical order by account name. Account Debit Credit ÷ 0 0 ÷ 0 0 ÷ 0 0 To record material price variance ÷ ÷ ÷ To record material quantity variance 0 0 0 Ooo 000

DM variances; journal entries Skip Company produces a product called Lem. The standard direct material cost to produce one unit of Lem is four quarts of raw material at $2.50 per quart. During May, 4,200 quarts of raw material were purchased at a cost of $10,080. All the purchased material was used to produce 1,000 units of Lem. a. Compute the material price variance and material quantity variance for May. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 b. Assume the same facts except that Skip Company purchased 6,000 quarts of material at the previously calculated cost per quart, but used only 4,200 quarts. Compute the material price variance and material quantity variance for May, assuming that Skip identifies variances at the earliest possible time. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 c. Prepare the journal entries to record the material price and usage variances calculated in (b). Note: List any multiple debits or any multiple credits in alphabetical order by account name. Account Debit Credit ÷ 0 0 ÷ 0 0 ÷ 0 0 To record material price variance ÷ ÷ ÷ To record material quantity variance 0 0 0 Ooo 000

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 3PA: Direct materials, direct labor, and factory overhead cost variance analysis Mackinaw Inc. processes...
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DM variances; journal entries Skip Company produces a product called Lem. The standard direct material cost to produce one unit of Lem is four quarts of raw material at $2.50 per quart. During May, 4,200 quarts of raw material were purchased at a cost of $10,080. All the purchased material was used to produce 1,000 units of Lem. a. Compute the material price variance and material quantity variance for May. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 b. Assume the same facts except that Skip Company purchased 6,000 quarts of material at the previously calculated cost per quart, but used only 4,200 quarts. Compute the material price variance and material quantity variance for May, assuming that Skip identifies variances at the earliest possible time. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 c. Prepare the journal entries to record the material price and usage variances calculated in (b). Note: List any multiple debits or any multiple credits in alphabetical order by account name. Account Debit Credit ÷ 0 0 ÷ 0 0 ÷ 0 0 To record material price variance ÷ ÷ ÷ To record material quantity variance 0 0 0 Ooo 000
Transcribed Image Text:DM variances; journal entries Skip Company produces a product called Lem. The standard direct material cost to produce one unit of Lem is four quarts of raw material at $2.50 per quart. During May, 4,200 quarts of raw material were purchased at a cost of $10,080. All the purchased material was used to produce 1,000 units of Lem. a. Compute the material price variance and material quantity variance for May. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 b. Assume the same facts except that Skip Company purchased 6,000 quarts of material at the previously calculated cost per quart, but used only 4,200 quarts. Compute the material price variance and material quantity variance for May, assuming that Skip identifies variances at the earliest possible time. Note: Do not use a negative sign with your answers. Material price variance $ Material quantity variance $ 0 0 c. Prepare the journal entries to record the material price and usage variances calculated in (b). Note: List any multiple debits or any multiple credits in alphabetical order by account name. Account Debit Credit ÷ 0 0 ÷ 0 0 ÷ 0 0 To record material price variance ÷ ÷ ÷ To record material quantity variance 0 0 0 Ooo 000
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