Please solve this problem Exercise 23-22 Your answer is partially correct. Try a
ID: 2559436 • Letter: P
Question
Please solve this problem
Exercise 23-22 Your answer is partially correct. Try again. Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (7 pounds at $2.60 per pound) Direct labor (4 hours at $14.00 per hour) During the month of April, the company manufactures 350 units and incurs the following actual costs. Direct materials purchased and used (2,490 pounds) Direct labor (1,430 hours) Journalize the entries to record the materials and labor variances. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round $18.20 $56.00 $6,972 $19,448 answers to O decimal places, e.g. 125.) Account Titles and Explanation Raw Materials Inventory Debit Credit 6474 Materials Price Variance 498 Accounts Payable 6972 (To record materials price variance)Explanation / Answer
Standard Cost For one unit Direct Material (7pound@2.60$/pound) 18.2 $ Direct Labour (4 hrs*$14 per hr) 56 $ Actual Cost 350 units Direct MaterialPurchased 2490 pound DirectMaterial cost $6,972 Actual Direct Labor 1430 hrs Actual Labor Cost $19,448 Direct Material Price Variance: = Actual Quantity x Actual Price - Actual Quantity x Standard Price $6972 - 2490 pound*2.6$per pound =$6972-$6474 =$498 favourable Direct Material Quantity Variance: = (Actual usage in units - Standard usage in units) x Standard cost per unit =(2490-7pound*350units)2.6$ =$104 favourable Direct Labour Price Variance= (Standad Rate*Actual Hrs -Actual Rate* Actual Hrs = $14/hr*1430 - $19448 = $20020-19448 = 572 Favourable Direct Labour Quantity Variance= (Std hrs for actual output-actual hrs worked)standard rate (4hrs*350units-1430 hrs)14$ = 420 Adverse JE Raw Materials (Inventory) 6474 Materials Price Variance 498 Accounts Payable 6972 Work In Process (Inv) 6370 Materials Quan Variance 104 Raw Materials (Inventory) 6474 Factory Labor 18876 Labor Price Variance 572 Wages Payable 19448 Work in Process (Inventory)18996 Labor Quantity Variance 120 Factory Labor 18876