P23-28A Computing and journalizing standard cost variances 
Java manufactures coffee mugs which it sells to other organizations for personalizing with their own trademarks. Java prepares flexible budgets and utilizes a standard cost system to manage production expenses. The standard unit price of a coffee mug is dependent on fixed budget quantity of 60,200 coffee mugs every month:
Actual cost and production information for July 2012 follow:
a. Actual output and sales were 62,900 coffee mugs.
b. Actual direct materials use was 10,000 lbs., at an actual cost of $0.17 per lb.
c. Actual direct labor use was 202,000 minutes at a total price of $30,300.
d. Actual overhead cost was $10,000 variable and $30,500 fixed.
e. Marketing as well as admin expenses were $115,000.
Requirements
1. Calculate the price and efficiency variances for direct materials and direct labor.
2. Journalize the use of direct materials and the assignment of direct labor, including the related variances.
3. For production overhead, calculate the variable overhead spending and efficiency variances and the fixed overhead spending and volume variances.
4. Journalize the actual production overhead and the applied production overhead. Journalize the movement of all production from WIP. Journalize the closing of the production overhead account.
5. Java intentionally employed more-skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise?