Problem:
Preparing a standard cost summary and making journal entires.
The normal capacity of Albany Adhesives Inc. is 40,000 direct labor hours and 20,000 units per month. A finished unit requires 6lbs of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10.00 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled $34,800 direct labor hours at an average of $9.50 an hour. The plant produced 18,000 units, using 105,000 lbs of material at a cost of $2.04 per pound.
Required:
Question 1: Prepare a standard cost summary showing the standard unit cost.
Question 2: Make journal entries to charge materials and labor to work in process.
Note: Please provide through step by step calculations.