Standard Products Company Recognizes Variances from Standards at the Earliest

question 7

Essay

Standard Products Company recognizes variances from standards at the earliest opportunity,and the quantity of direct materials purchased is equal to the quantity used.The following information is available for the most recent month.Assume the allocation base for fixed overhead costs is the number of units.
Journalize the direct labor costs incurred and the assignment of direct labor to Work in Process Inventory,including the related variances.

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Definitions:

Ending Inventory Balance

The total value of all goods available for sale at the end of an accounting period.

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal, utilized in inventory valuation and accounts receivable.

Internal Controls

Systems and procedures implemented by a company to ensure integrity of financial and accounting information, promote accountability, and prevent fraud.

Inventory Tickets

Documentation that tracks the quantity and description of inventory items in stock.