In: Accounting
A certain department produced 16,000 units of a product that had
a standard materials cost of two pounds at $1.70 per pound and a
standard labor cost of two hours per unit at $9.40 per hour. Actual
materials purchased and used amounted to 32,200 pounds at $1.60 per
pound, while actual direct labor consisted of 32,200 hours at a
total labor cost of $305,900.
A. Use T-accounts to record the purchase of materials, transfer of materials to work in process, and apply direct labor costs to work in process (including closing the variance accounts).