Chapter 23, Problem 17QS

To determine

Introduction:

In the given question, Alvarez records standard cost in its accounts. It means that it uses standard cost of particular transaction related to production to incorporate in books of accounts. But it is not necessary or to say impossible that actual cost is the same as the standard cost. So to incorporate the difference between actual cost and standard cost, the company debited or credited the variance account to make the transaction at the actual cost.

To make:-

1. Journal Entry to charge overhead cost to the work in process inventory account and to record any variances. Figures related to entry are provided in QS 23-16.