Question

Required information [The following information applies to the questions displayed below.] Hart Company made 3,080 bookshelves using 22,080 board feet of wood costing $276,000. The company's direct materials standards for one bookshelf are 8 board feet of wood at $12.40 per board foot.

Answer 1

H I J K Requirement 1 Calculate direct material variances Actual cost Standard cost X JAP A Q SP SQ X SP 220801 12.5 22080 X 12.4 24640 12.4 276000 2737921 305536 2208 31744 Direct materials price variance 2208U Direct materials quantity variance 31744 F Total direct materials variance 29536 F Direct materials quantity variance has to be further investigated since the variance between standard quantity and actual quantity is huge, hence there is need for Requirement 2 further investigation.

Requirement 1 AQ G H I J K L M Calculate direct material variances Actual cost TT T Standard cost x |АР AOX SP so IX SP 22080 X =276000/22080 22080 X 12.4 =3080*8 X 12.4 =C4*64 =G4*14 =K4*M4 =D5-H5 =L5-H5 Direct materials price variance |=F6 JU Direct materials quantity variance 1=J6 F Total direct materials variance =D8-D7F Direct materials quantity variance has to be further investigated since the variance between standard quantity and actual quantity is huge, hence there is need for further investigation. Requirement 2

Part 2 Record price and quantity variances General Journal debit credit 1 Goods in process inventory | 305536 Direct materials price variance 2208) Direct materials quantity variance 31744 Raw materials inventory 276000 Record closing of price and quantity variances to cost of goods sold Transaction general journal debit credit 1 direct materials quantity variance 31744 Direct materials price variance 2208 Cost of goods sold 295361