Chips Co Assigned Direct Labor Cost to Its Products in May

question 143

Essay

Chips Co. assigned direct labor cost to its products in May for 1,300 standard hours of direct labor at the standard $8 per hour rate. The direct labor rate variance for the month was $200 favorable and the direct labor efficiency variance was $150 favorable. Prepare the journal entry to charge Goods in Process Inventory for the standard labor cost of the goods manufactured in May and to record the direct labor variances. Assuming that the direct labor variances are immaterial, prepare the journal entry that Chips would make to close the variance accounts.

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Definitions:

Left Coronary Artery

The artery that supplies blood to the left side of the heart, critical for providing oxygen-rich blood to the heart muscle.

Peripheral Edema

Peripheral edema is the swelling of tissues, usually in the lower limbs, due to the accumulation of fluid, often indicating underlying health conditions.

Jugular Vein

A large vein in the neck that carries blood from the head back to the heart; often observed in medical assessments for signs of heart failure.

Crackles

Abnormal lung sounds heard through a stethoscope, typically indicating fluid in the airways.