60.1K

Verified Solution

Link Copied!

During the accounting period, Acme purchased materials for production of $400,000 on credit. According to the companys standard costs, the company anticipated the cost of the materials should have been $380,000. The journal entry to record part of the transaction should include:

a) Addition of materials into production:

A ___________(DB, CR) to ___________(RM, WIP, FG COGS, CASH, AP, PPV MUV, LEV, LRV)in the amount of $________

b) Recording of the variance:

A _______ (DB, CR) to __________(RM, WIP, FG COGS, CASH, AP, PPV MUV, LEV, LRV) in the amount of $_______

During the accounting period, Acme paid production payroll of $600,000. For the level pf production achieve, Acme expected to pay $620,000. The reason for the difference between actual and expected costs was that Acme paid its workers $60,000 more than expected while the workers produced $80,000 more product than expected. The journal entry to the transaction should have included:

c) Addition of labor costs into production:

A __________ (DB, CR) to ____________ (RM, WIP, FG COGS, CASH, AP, PPV MUV, LEV, LRV) in the amount of ______

d) A dollar variance due to paying workers at an actual labor rate different than the anticipated labor rate:

A _______(DB, CR) to ______ (RM, WIP, FG COGS, CASH, AP, PPV MUV, LEV, LRV)in the amount of ___________

e) A dollar variance due to the workers taking more time than anticipated to produce products:

A ________ (DB, CR) to _________ (RM, WIP, FG COGS, CASH, AP, PPV MUV, LEV, LRV)in the amount of ______

Answer & Explanation Solved by verified expert

See Answer