Cheever Company uses a standard cost system for its single product. The following data are available:Actual results for the current period:Purchase of direct materials (20 000 pounds)……….. $19 500Direct materials used…………………………………………. 12 000 poundsDirect Labor (10 200 hours)…………………………….. $102 000Units Produced ………………………………………………… 12 600Standard cost material quantity and direct labor hours and rate per unit of output:Direct Materials: 1 pound at $1 per poundDirect Labor: 1 hour at $9.50 per hourRequired:1. Compute the direct materials price and efficiency variances.2. Compute the direct labor price and efficiency variances.3. Prepare one journal entry to record the actual direct labor cost and the amount applied to production including the direct labor price (rate) and efficiency (quantity) variances (standard costing system).4. Prepare the journal entry under a standard costing system (including variances) to:(a) record the purchase of direct materials.(b) record the usage of direct materials in production
