Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
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Textbook Question
Chapter 23, Problem 21E
Income statement indicating
The following data were taken from the records of Griggs Company for December:
Prepare an income statement for presentation to management.
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Amada Company's standard cost system reports this information from its December operations.
Standard direct materials cost
Direct materials quantity variance
Direct materials price variance
Actual direct labor cost
Direct labor efficiency variance
Direct labor rate variance
Actual overhead cost
Volume variance
Controllable variance
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Journal entry worksheet
1
Required:
1. Prepare December 31 journal entries to record the company's costs and variances for the month for (a) direct materials, (b) direct
labor, and (c) overhead. Ignore the journal entry to close the variances.
2
3
Record direct materials costs and variances.
Date
December
31
Note: Enter debits before credits.
$ 100,000
General Journal
3,000 U
500 F
90,000
7,000 F
1,200 U
375,000
12,000 U
9,000 U
Debit
Credit
>
Journalizing labor entries
The following direct labor variance analysis was performed tor Morris.
Requirements
Record Morris’s direct labor journal entry (use Wages Payable).
Explain what management will do with this variance information.
Ehrlich Inc. makes a product with the following standard costs for direct
material and direct labor:
Quantity/Hours
Price /Rate
Per Unit
Direct Material
6.00 lbs
$ 3.80
Direct Labor
1.5 hrs
$ 16.00
During the most recent month, 6,300 units were produced. The costs associated
with the month's production of this product were as follows:
Quantity/Hours
Price /Rate
Materials purchased
42,000 lbs
$3.00/per lbs.
Materials used in production
32,000 lbs
Direct labor
9,950 hrs
$14.50/per hr.
Chapter 23 Solutions
Financial And Managerial Accounting
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