Darren Company Adopted a Standard Cost System Several Years Ago $\begin{array}{llcc} \text { Material:8 kilograms@\$5 per kilogram } & \$40.00\\ \text { Labor:6hours@\$8.20perhour } &\$49.20 \\\end{array}$

question 27

Essay

Darren Company adopted a standard cost system several years ago. The standard costs for the prime costs of its single product are as follows:
$\begin{array}{llcc} \text { Material:8 kilograms@\$5 per kilogram } & \$40.00\\ \text { Labor:6hours@\$8.20perhour } &\$49.20 \\\end{array}$

The following operating data were taken from the records for November:
$\begin{array}{lc}\text { Units completed } & 5,600 \text { units } \\\text { Budgeted output } & 6,000 \text { units } \\\text { Purchase of materials } & 50,000 \text { kilograms }\\\text { Total actual labor costs}&\$ 300,760 \\\text { Actual labor hours}&36,50 \text { hours}\\\text { Material efficiency (quantity) variance } & \$ 1,500 \text { Unfavorable } \\\text { Total material variance } & \$ 750 \text {unfavorable }\end{array}$
Required:
Prepare the journal entries to record the following:
a. Purchase and use of direct materials (Assume materials are used as purchased and no inventory is maintained).
b. Recognition of direct labor.

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Definitions:

Agent

An agent is a person or entity authorized to act on behalf of another person or entity, known as the principal, in legal or business matters.

Legally Enter

The act of gaining access or entry to a property, system, or situation in accordance with the law and authorized permissions.

Contract

A contract is a legally binding agreement between two or more parties that outlines obligations each party must perform.

Indirectly

In a manner that is not straightforward or direct; happening through secondary or alternative means or effects.