Recording Standards in Accounts The Assembly Department produced 2,000 units of

Question

Recording Standards in Accounts The Assembly Department produced 2,000 units of product during March. Each unit required 1.75 standard direct labor hours. There were 3,700 actual hours used in the Assembly Department during March at an actual rate of $11 per hour. The standard direct labor rate is $11.5 per hour. Assuming direct labor for a month is paid on the fifth day of the following month, journalize the direct labor in the Assembly Department on March 31. For a compound transaction, if an amount box does not require an entry, leave it blank. March 31 Work in Process Direct Labor Time Variance ( Direct Labor Rate Variance V Wages Payable

Explanation / Answer

direct labor rate variance (actual rate * actual hours   - standard rate *actual hours) 3700*11               - 3700*11.5 40,700 - 42,550 1850 F Direct labor Efficiency variance (Actual hours - standard hours)*standard rate (3700*11.5           - 2000*1.75*11.5) 42,550   - 40,250 2300 U 31-Mar work in process 40,250 Direct labor time variance 2,300 direct labor rate variance 1,850 Wages payable 40,700

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