Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Question

Question

Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Information on Grand Corporation’s direct materials costs follows.


Quantities of chemical Y purchased and used		19,400	gallons
Actual cost of chemical Y used	$	426,000
Standard price per gallon of chemical Y	$	22.70
Standard quantity of chemical Y allowed		17,800	gallons

Grand Corporation has no materials inventories.

Required:

a. What were Grand Corporation’s direct materials price and efficiency variances?
b. (Appendix) Prepare the journal entries to record the purchase and use of chemical Y using standard costing.

business accounting

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

	GRAND CORPORATION
a.
		Quantity	Price	Cost
	Actual	19400	$ 21.96	$ 426,000
	Standard	17800	$ 22.70	$ 404,060


	Material Price Variance		=	(Actual Price- Standard Price)* Actual Qty
			=	(21.96-22.70)*19400
			=	14380	Favourable


	Material Efficiency Variance		=	(Actual Qty- Standard Qty)*Standard Price
			=	(19400-17800)*22.70
			=	36320	Unfavourble



	Material Cost Variance		=	Actual Cost-Standard Cost
			=	426000-404060
			=	21940	Unfavourble


	Material Cost Variance		=	Material Price Variance	+	Material Efficiency Variance
			=	14380 (F)	+	36320 (UF)
			=	21940	Unfavourble



b.
	Journal Entries

	Date	Particulars			Debit	Credit
		Chemical Y (17800 gallons * $22.70/ per gallon)			404060
		Direct Material Cost Variance			21940
			To Accounts Payable			426000



		Chemical Y (FG)	(19400* $22.70/per gallon)		440380
			To Direct Material Efficiency Variance			36320
			To Chemical Y (17800 gallons * $22.70/ per gallon)			404060

Add a comment

Answer 2

Similar Homework Help Questions

Information on Grand Corporation's direct materials costs follows. Quantities of chemical Y purchased and used Actual...

Information on Grand Corporation's direct materials costs follows. Quantities of chemical Y purchased and used Actual cost of chemical Y used Standard price per gallon of chemical Y Standard quantity of chemical Y allowed 19,600 gallons $427,000 $ 22.90 18,000 gallons bok Grand Corporation has no materials inventories. Required: a. What were Grand Corporation's direct materials price and efficiency variances? b. (Appendix) Prepare the journal entries to record the purchase and use of chemical y using standard costing. Complete this...
Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 31,900 Actual...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 31,900 Actual costs of direct materials used $ 146,600 Standard price per unit of direct materials $ 4.39 Flexible budget for direct materials $ 123,500 Bowgie Chemicals has no materials inventories. Required: a. Prepare a short report for management showing Bowgie Chemicals’s direct materials price and efficiency variances. b. (Appendix) Prepare the journal entries to record the purchase and use of the direct materials using standard...
Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used Actual costs...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used Actual costs of direct materials used Standard price per unit of direct materials Flexible budget for direct materials 31,600 $144,200 $ 4.36 $122,900 Bowgie Chemicals has no materials inventories. Required: a. Prepare a short report for management showing Bowgie Chemicals's direct materials price and efficiency variances. b. (Appendix) Prepare the journal entries to record the purchase and use of the direct materials using standard costing. Complete...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 30,800 Actual costs of direct materials used $ 137,800 Standard price per unit of direct materials $ 4.28 Flexible budget for di

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used30,800Actual costs of direct materials used$137,800Standard price per unit of direct materials$4.28Flexible budget for direct materials$121,300 Bowgie Chemicals has no materials inventories. Required:a. Prepare a short report for management showing Bowgie Chemicals’s direct materials price and efficiency variances.b. (Appendix) Prepare the journal entries to record the purchase and use of the direct materials using standard costing.
Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 30,800 Actual costs of direct materials used $ 137,800 Standard price per unit of direct materials $ 4.28 Flexible budget for di

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used30,800Actual costs of direct materials used$137,800Standard price per unit of direct materials$4.28Flexible budget for direct materials$121,300 Bowgie Chemicals has no materials inventories. Required:a. Prepare a short report for management showing Bowgie Chemicals’s direct materials price and efficiency variances.b. (Appendix) Prepare the journal entries to record the purchase and use of the direct materials using standard costing.
Information on Bowgie Chemicals direct materials costs follows: Actual quantities of direct materials used 31,400 Actual...

Information on Bowgie Chemicals direct materials costs follows: Actual quantities of direct materials used 31,400 Actual costs of direct materials used $ 142,600 Standard price per unit of direct materials $ 4.34 Flexible budget for direct materials $ 122,500 Bowgie Chemicals has no materials inventories. Required: a. Prepare a short report for management showing Bowgie Chemicals's direct materials price and efficiency variances. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is...

Information on OCP's direct materials costs for the current month is as follows: actual quantity of...

Information on OCP's direct materials costs for the current month is as follows: actual quantity of direct materials purchased and used, 30,000 pounds; actual cost of direct materials, $84,000; direct materials efficiency variance, $3,000 U; standard quantity of direct materials allowed for the current month's production, 29,000 pounds. Based on the presented information, OCP's direct materials price variance for the month is closest to a. $2,800 F b. $2,800 U c. $6,000 U d. $6,000 F
The following information describes production activities of Mercer Manufacturing for the year. Actual direct materials used...

The following information describes production activities of Mercer Manufacturing for the year. Actual direct materials used 22,000 lbs. at $4.35 per lb. 6,575 hours for a total of Actual direct labor used $128,870 Actual units produced 36,000 Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.30 per pound and 10 minutes of direct labor at $20.60 per hour. AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price AH...
The following information describes production activities of Mercer Manufacturing for the year Actual direct materials used...

The following information describes production activities of Mercer Manufacturing for the year Actual direct materials used 22,880 lbs. at $4.35 per lb. 6,575 hours for a total of Actual direct labor used $128,870 Actual units produced 36,000 Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.30 per pound and 10 minutes of direct laborat $20.60 per hour AQ = Actual Quantity SQ = Standard Quantity AP - Actual Pnce SP = Standard Price AH =...

The following company information is available. The direct materials quantity variance is: Direct materials used for...

The following company information is available. The direct materials quantity variance is: Direct materials used for prodution Standard quantity for units produced Standard cost per gallon of direct material Actual cost per gallon of direct material 35,000 gallons 33,400 gallons $11.00 $11.20 Multiple Choice $17600 unfavorable. $17200 favorable $24,600 unfavorable Multiple Choice $17,600 unfavorable. $17.200 favorable. $24,600 unfavorable. $24,600 favorable. $17,200 unfavorable Use the following data to find the direct labor rate variance if the company produced 3,500 units during...

Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Homework Answers

Add Answer to:
Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Post as a guest

Earn Coins

Information on Grand Corporation's direct materials costs follows. Quantities of chemical Y purchased and used Actual...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 31,900 Actual...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used Actual costs...

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 30,800 Actual costs of direct materials used $ 137,800 Standard price per unit of direct materials $ 4.28 Flexible budget for di

Information on Bowgie Chemicals direct materials costs follows. Actual quantities of direct materials used 30,800 Actual costs of direct materials used $ 137,800 Standard price per unit of direct materials $ 4.28 Flexible budget for di

Information on Bowgie Chemicals direct materials costs follows: Actual quantities of direct materials used 31,400 Actual...

Information on OCP's direct materials costs for the current month is as follows: actual quantity of...

The following information describes production activities of Mercer Manufacturing for the year. Actual direct materials used...

The following information describes production activities of Mercer Manufacturing for the year Actual direct materials used...

The following company information is available. The direct materials quantity variance is: Direct materials used for...

Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Homework Answers

Add Answer to: Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...

Post as a guest

Earn Coins

Add Answer to:
Information on Grand Corporation’s direct materials costs follows. Quantities of chemical Y purchased and used 19,400...