(Appendix used in Part b) Variable Cost Variances
Information on Canyon Chemical’s direct materials costs follows:
|
Quantities of chemical Y purchased and used |
28,800 gallons |
|
Actual cost of chemical Y used |
$640,000 |
|
Standard price per gallon of chemical Y |
$22.50 |
|
Standard quantity of chemical Y allowed |
26,400 gallons |
Required
a. What were Canyon Chemical’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.