Deck 16: Journal Entries to Record Variance

Question 1

If the actual direct labor-hours used is less than the standard direct labor-hours allowed for the actual output,then the journal entry to record the Labor Efficiency Variance would be a credit.

Answer 1

True

Question 2

If the actual rate per direct labor-hour exceeds the standard rate per direct labor-hour,then the journal entry to record the Labor Rate Variance would be a debit.

Answer 2

True

Question 3

If the actual purchase price for materials exceeds the standard purchase price,then the journal entry to record the Direct Materials Price Variance would be a credit.

Answer 3

False

Question 4

When the actual price to purchase a raw material on account exceeds its standard price,the journal entry would include:

A)Debit to Raw Materials;Credit to Materials Price Variance
B)Debit to Accounts Payable;Credit to Materials Price Variance
C)Debit to Raw Materials;Debit to Materials Price Variance
D)Debit to Accounts Payable;Debit to Materials Price Variance

Question 5

The journal entry below: indicates that:

A)the total labor variance was $800,unfavorable.
B)employees received an unexpected rate increase during the period.
C)more labor time was required to complete the output of the period than was allowed at standard.
D)Work in Process valued at $25,000 was completed and transferred to Finished Goods.

Question 6

When the actual price to purchase a raw material on account is less than its standard price,the journal entry would include:

A)Credit to Raw Materials;Credit to Materials Price Variance
B)Credit to Accounts Payable;Credit to Materials Price Variance
C)Credit to Raw Materials;Debit to Materials Price Variance
D)Credit to Accounts Payable;Debit to Materials Price Variance

Question 7

An unfavorable materials price variance is recorded as a debit in the Materials Price Variance account.

Question 8

A favorable materials quantity variance would appear as a credit in a journal entry.

Question 9

If the actual quantity of materials used is less than the standard quantity of materials allowed for the actual output,then the journal entry to record the Direct Materials Quantity Variance would be a debit.

Question 10

A favorable labor efficiency variance is recorded as a debit in the Labor Efficiency Variance account.

Question 11

A favorable labor efficiency variance would result in a debit balance in the labor efficiency variance account.

Question 12

During the month of May,Marian Manufacturing Corporation purchased materials that had a total standard cost of $37,000.The Materials Price Variance on these materials was $6,000 favorable.What summary journal entry would Domino make to record this purchase and variance for May?

A)Option A
B)Option B
C)Option C
D)Option D

Question 13

An unfavorable labor rate variance is recorded as a debit in the Labor Rate Variance account.

Question 14

An unfavorable labor efficiency variance is recorded as a debit in the Labor Efficiency Variance account.

Question 15

If the actual rate per direct labor-hour is less than the standard rate per direct labor-hour,then the journal entry to record the Labor rate variance would be a credit.

Question 16

When the actual wage rate paid to direct labor workers exceeds the standard wage rate,the journal entry would include:

A)Credit to Wages Payable;Credit to Labor Rate Variance
B)Credit to Work-In-Process;Credit to Labor Rate Variance
C)Credit to Wages Payable;Debit to Labor Rate Variance
D)Credit to Work-In-Process;Debit to Labor Rate Variance

Question 17

Liukko Corporation's standard wage rate is $14.90 per direct labor-hour (DLH)and according to the standards,each unit of output requires 2.8 DLHs.In June,1,800 units were produced,the actual wage rate was $15.80 per DLH,and the actual hours were 5,110 DLHs.The Labor Efficiency Variance for June would be recorded as a:

A)debit of $1,106.
B)credit of $1,106.
C)credit of $1,043.
D)debit of $1,043.

Question 18

An unfavorable materials quantity variance is recorded as a debit in the Materials Quantity Variance account.

Question 19

When the actual direct labor-hours exceeds the standard direct labor-hours allowed for the actual output of the period,the journal entry would include:

A)Credit to Wages Payable;Credit to Labor Efficiency Variance
B)Credit to Work-In-Process;Credit to Labor Efficiency Variance
C)Credit to Wages Payable;Debit to Labor Efficiency Variance
D)Credit to Work-In-Process;Debit to Labor Efficiency Variance

Question 20

When the actual amount of a raw material used in production is greater than the standard amount allowed for the actual output,the journal entry would include:

A)Credit to Raw Materials;Credit to Materials Quantity Variance
B)Credit to Work-In-Process;Credit to Materials Quantity Variance
C)Credit to Raw Materials;Debit to Materials Quantity Variance
D)Credit to Work-In-Process;Debit to Materials Quantity Variance

Question 21

Gramajo Corporation's standard wage rate is $10.10 per direct labor-hour (DLH)and according to the standards,each unit of output requires 3.4 DLHs.In February,2,400 units were produced,the actual wage rate was $9.40 per DLH,and the actual hours were 7,920 DLHs.In the journal entry to record the incurrence of direct labor costs in February,the Work in Process entry would consist of a:

A)credit of $74,448.
B)debit of $74,448.
C)debit of $82,416.
D)credit of $82,416.

Question 22

Miolen Corporation has provided the following data concerning its direct labor costs for June: The Labor Efficiency Variance for June would be recorded as a:

A)credit of $50,128.
B)debit of $46,272.
C)debit of $50,128.
D)credit of $46,272.

Question 23

Widman,Inc.makes and sells only one product and uses standard costing.The standard cost sheet for one unit of product includes the following: • Direct materials: 5 grams at $0.35 per gram
• Direct labor: 1 hour at $8 per hour
Last period the company had the following results:
• 5,000 grams of direct materials purchased at $0.40 per gram
• 4,000 grams of direct materials used in production
• 900 units of product were made
• 850 hours of direct labor were used at $8.50 per hour
The journal entry to record the incurrence of direct labor cost last period would include:

A)Work in process $7,200,Debit;labor efficiency variance $400,Credit
B)Work in process $7,200,Debit;labor efficiency variance $400,Debit
C)Work in process $6,800,Debit;labor rate variance $425,Debit
D)Work in process $6,800,Debit;labor rate variance $425,Credit

Question 24

Widman,Inc.makes and sells only one product and uses standard costing.The standard cost sheet for one unit of product includes the following: • Direct materials: 5 grams at $0.35 per gram
• Direct labor: 1 hour at $8 per hour
Last period the company had the following results:
• 5,000 grams of direct materials purchased at $0.40 per gram
• 4,000 grams of direct materials used in production
• 900 units of product were made
• 850 hours of direct labor were used at $8.50 per hour
The journal entry to record the purchase of direct materials last period would include:

A)Raw materials $2,000,Debit;materials price variance $250,Credit
B)Raw materials $1,750,Debit;materials price variance $250,Credit
C)Raw materials $2,000,Debit;materials price variance $250,Debit
D)Raw materials $1,750,Debit;materials price variance $250,Debit

Question 25

Gainer Corporation's standard wage rate is $11.70 per direct labor-hour (DLH)and according to the standards,each unit of output requires 3.9 DLHs.In February,7,800 units were produced,the actual wage rate was $12.50 per DLH,and the actual hours were 29,940 DLHs.The Labor Rate Variance for February would be recorded as a:

A)debit of $23,952.
B)credit of $23,952.
C)credit of $24,336.
D)debit of $24,336.

Question 26

Florea Corporation has provided the following data concerning its most important raw material,compound K09B: The raw material was purchased on account. The debits to the Raw Materials account for August would total:

A)$39,750
B)$15,900
C)$14,840
D)$40,050

Question 27

Data concerning the direct labor costs for March of Boler Corporation appear below: The journal entry to record the incurrence of direct labor costs in March would include the following for Work in Process:

A)credit of $125,139.
B)debit of $114,948.
C)credit of $114,948.
D)debit of $125,139.

Question 28

Compound K52E is a raw material used to make Pinkos Corporation's major product.The standard cost of compound K52E is $46.00 per ounce and the standard quantity is 5.0 ounces per unit of output.Data concerning the compound for March appear below: The raw material was purchased on account. The Materials Quantity Variance for March would be recorded as a:

A)Credit of $19,780
B)Credit of $5,980
C)Debit of $19,780
D)Debit of $5,980

Question 29

Compound K52E is a raw material used to make Pinkos Corporation's major product.The standard cost of compound K52E is $46.00 per ounce and the standard quantity is 5.0 ounces per unit of output.Data concerning the compound for March appear below: The raw material was purchased on account. The credits to the Raw Materials account for March would total:

A)$172,420
B)$184,000
C)$170,200
D)$164,220

Question 30

Florea Corporation has provided the following data concerning its most important raw material,compound K09B: The raw material was purchased on account. The Materials Price Variance for August would be recorded as a:

A)Credit of $112
B)Credit of $300
C)Debit of $112
D)Debit of $300

Question 31

Compound K52E is a raw material used to make Pinkos Corporation's major product.The standard cost of compound K52E is $46.00 per ounce and the standard quantity is 5.0 ounces per unit of output.Data concerning the compound for March appear below: The raw material was purchased on account. The Materials Price Variance for March would be recorded as a:

A)Debit of $2,220
B)Debit of $2,142
C)Credit of $2,220
D)Credit of $2,142

Question 32

Barbu Corporation has provided the following data concerning its direct labor costs for June: The Labor Rate Variance for June would be recorded as a:

A)credit of $6,305.
B)credit of $6,500.
C)debit of $6,305.
D)debit of $6,500.

Question 33

Marusarz Corporation has provided the following data concerning its most important raw material,compound F55M: When recording the purchase of materials,Raw Materials would be:

A)credited for $74,120.
B)debited for $73,270.
C)debited for $74,120.
D)credited for $73,270.

Question 34

Florea Corporation has provided the following data concerning its most important raw material,compound K09B: The raw material was purchased on account. The credits to the Raw Materials account for August would total:

A)$40,050
B)$14,840
C)$39,750
D)$15,900

Question 35

Compound K52E is a raw material used to make Pinkos Corporation's major product.The standard cost of compound K52E is $46.00 per ounce and the standard quantity is 5.0 ounces per unit of output.Data concerning the compound for March appear below: The raw material was purchased on account. The debits to the Raw Materials account for March would total:

A)$170,200
B)$172,420
C)$184,000
D)$164,220

Question 36

Widman,Inc.makes and sells only one product and uses standard costing.The standard cost sheet for one unit of product includes the following: • Direct materials: 5 grams at $0.35 per gram
• Direct labor: 1 hour at $8 per hour
Last period the company had the following results:
• 5,000 grams of direct materials purchased at $0.40 per gram
• 4,000 grams of direct materials used in production
• 900 units of product were made
• 850 hours of direct labor were used at $8.50 per hour
The journal entry to record the use of direct materials in production last period would include:

A)Work in process $1,400,Debit;materials quantity variance $175,Debit
B)Work in process $1,575,Debit;materials quantity variance $175,Credit
C)Work in process $1,400,Debit;materials quantity variance $175,Credit
D)Work in process $1,575,Debit;materials quantity variance $175,Debit

Question 37

Compound B73G is used to make Vasconcellos Corporation's major product.The standard cost of B73G is $27.60 per ounce and the standard quantity is 8.6 ounces per unit of output.In the most recent month,3,200 ounces of the raw material were purchased at a cost of $26.70 per ounce.When recording the purchase of materials,Raw Materials would be:

A)debited for $88,320.
B)debited for $85,440.
C)credited for $85,440.
D)credited for $88,320.

Question 38

Slife Corporation has provided the following data concerning its most important raw material,compound G81N: When recording the use of materials in production,Raw Materials would be:

A)debited for $68,558.
B)credited for $83,839.
C)credited for $68,558.
D)debited for $83,839.

Question 39

Compound K72R is used to make Munuz Corporation's major product.The standard cost of compound K72R is $43.90 per ounce and the standard quantity is 1.4 ounces per unit of output.In the most recent month,120 ounces of the compound were used to make 100 units of the output.When recording the use of materials in production,Raw Materials would be:

A)debited for $5,268.
B)credited for $6,146.
C)credited for $5,268.
D)debited for $6,146.

Question 40

Results of operations for the Anderson Corporation indicated that the actual direct labor rate for May was $9.75 while the standard rate was $10.00.The general ledger entry to record the incurrence of direct labor cost would include:

A)a debit to Work In Process for the actual number of hours times $9.75 per hour.
B)a debit to Work In Process for the standard number of hours times $10.00 per hour.
C)a debit to Work In Process for the standard number of hours times $9.75 per hour.
D)a debit to Work In Process for the actual number of hours times $10.00 per hour.

Question 41

Pinkney Corporation has provided the following data concerning its direct labor costs for November: Required:
Prepare the journal entry to record the incurrence of direct labor costs.

Question 42

Compound C65Z is used by Sinkey Corporation to make one of its products.The standard cost of compound C65Z is $21.10 per ounce and the standard quantity is 2.0 ounces per unit of output.Data concerning the compound in the most recent month appear below: The raw material was purchased on account.
Required:
a.Record the purchase of the raw material in a journal entry.
b.Record the use of the raw material in production in a journal entry.

Question 43

Enwall Corporation's standard wage rate is $11.20 per direct labor-hour (DLH)and according to the standards,each unit of output requires 2.9 DLHs.In December,5,900 units were produced,the actual wage rate was $10.20 per DLH,and the actual hours were 14,150 DLHs. The Labor Efficiency Variance for December would be recorded as a:

A)debit of $33,152.
B)credit of $30,192.
C)credit of $33,152.
D)debit of $30,192.

Question 44

The following standards have been established for a raw material used in the production of product G13: The following data pertain to a recent month's operations: Required:
a.What is the materials price variance for the month?
b.What is the materials quantity variance for the month?
c.Prepare journal entries to record the purchase and use of the raw material during the month.(All raw materials are purchased on account. )

Question 45

The following direct labor standards have been established for product N30A: The following data pertain to the most recent month's operations during which 400 units of product N30A were made: Required:
a.What was the labor rate variance for the month?
b.What was the labor efficiency variance for the month?
c.Prepare a journal entry to record direct labor costs during the month,including the direct labor variances.

Question 46

Cafferty Corporation has provided the following data concerning its direct labor costs for March: The journal entry to record the incurrence of direct labor costs in March would include the following for Work in Process:

A)Credit of $33,280
B)Debit of $35,625
C)Debit of $33,280
D)Credit of $35,625

Question 47

The direct labor standards at Hebden Corporation are $10.30 per direct labor-hour (DLH)and 3.4 DLHs per unit of output.In December,7,800 units were produced,the actual wage rate was $9.90 per DLH,and the actual hours were 21,340 DLHs.
Required:
Prepare the journal entry to record the incurrence of direct labor costs.

Question 48

Florea Corporation has provided the following data concerning its most important raw material,compound K09B: The raw material was purchased on account. The Materials Quantity Variance for August would be recorded as a:

A)Credit of $24,910
B)Credit of $1,060
C)Debit of $1,060
D)Debit of $24,910

Question 49

The standards for product Q58W specify 8.4 direct labor-hours per unit at $14.00 per direct labor-hour.Last month 400 units of product Q58W were produced using 2,800 direct labor-hours at a total direct labor wage cost of $41,020.
Required:
a.What was the labor rate variance for the month?
b.What was the labor efficiency variance for the month?
c.Prepare a journal entry to record direct labor costs during the month,including the direct labor variances.

Question 50

Ungvarsky Corporation has provided the following data concerning its most important raw material,compound J38F: The raw material was purchased on account.
Required:
a.Record the purchase of the raw material in a journal entry.
b.Record the use of the raw material in production in a journal entry.

Question 51

Cafferty Corporation has provided the following data concerning its direct labor costs for March: The Labor Efficiency Variance for March would be recorded as a:

A)Debit of $3,200
B)Credit of $3,125
C)Credit of $3,200
D)Debit of $3,125

Question 52

Enwall Corporation's standard wage rate is $11.20 per direct labor-hour (DLH)and according to the standards,each unit of output requires 2.9 DLHs.In December,5,900 units were produced,the actual wage rate was $10.20 per DLH,and the actual hours were 14,150 DLHs. In the journal entry to record the incurrence of direct labor costs in December,the Work in Process entry would consist of a:

A)credit of $144,330.
B)debit of $191,632.
C)debit of $144,330.
D)credit of $191,632.

Question 53

The standards for product F28 call for 2.7 pounds of a raw material that costs $16.50 per pound.Last month,4,100 pounds of the raw material were purchased for $70,520.The actual output of the month was 1,300 units of product F28.A total of 3,500 pounds of the raw material were used to produce this output.
Required:
a.What is the materials price variance for the month?
b.What is the materials quantity variance for the month?
c.Prepare journal entries to record the purchase and use of the raw material during the month.(All raw materials are purchased on account. )

Question 54

Albert Manufacturing Company manufactures a single product.The standard cost of one unit of this product is: During the month of October,6,000 units were produced.Selected cost data relating to the month's production follow: There was no beginning inventory of raw materials.The variable overhead rate is based on direct labor-hours.
Required:
a.For direct materials,compute the price and quantity variances for the month,and prepare journal entries to record activity for the month.
b.For direct labor,compute the rate and efficiency variances for the month,and prepare a journal entry to record labor activity for the month.
c.For variable overhead,compute the rate variance for the month.

Question 55

Cafferty Corporation has provided the following data concerning its direct labor costs for March: The Labor Rate Variance for March would be recorded as a:

A)Credit of $855
B)Credit of $780
C)Debit of $780
D)Debit of $855

Question 56

Enwall Corporation's standard wage rate is $11.20 per direct labor-hour (DLH)and according to the standards,each unit of output requires 2.9 DLHs.In December,5,900 units were produced,the actual wage rate was $10.20 per DLH,and the actual hours were 14,150 DLHs. The Labor Rate Variance for December would be recorded as a:

A)debit of $14,150.
B)credit of $17,110.
C)debit of $17,110.
D)credit of $14,150.