Albertson Co. uses a standard costing system to account for its production of toys. Plastic is added at the start of production; labor and overhead are incurred at equal rtes throughout the process. The standard cost of one toy is as follows:
Direct material $0.10
Direct Labor 0.02
Overhead 0.07
Total Cost $0.19
The following production and cost data are applicable to April 2010:
Beginning WIP inventory (45% complete) 180,000 units
Units started in April 1,300,000 units
Ending WIP inventory (65% complete) 144,000 units
Current cost of direct material $ 184,000
Current cost of direct labor 27,126
Current cost of overhead 93,000
a. What amount is carried as the April beginning balance of WIP inventory?
b. What amount is carried as the April ending balance of WIP inventory?
c. What amount is transferred to Finished Goods Inventory for April?
d. What are the total direct material, direct labor, and overhead variances for April?
e. Record the journal entries to recognize the direct material, direct labor, and overhead variances.
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