Accounting Journal Entries, Overhead Variance Report and Analysis

This assignment presents a detailed overview of accounting journal entries and an overhead variance report. It includes journal entries for various transactions such as direct materials purchases, factory overhead, wages, and sales. The assignment also provides an overhead variance report, comparing standard and actual costs for depreciation and factory overhead, explaining the variance analysis. The journal entries cover transactions from August 2nd to August 31st, detailing debits and credits for each transaction. The overhead variance report highlights the difference between standard and actual costs, providing insights into cost control and financial performance. The content is designed to help students understand and apply accounting principles, with solutions available on Desklib.

Running Head: DIPLOMA IN ACCOUNTING
DIPLOMA IN ACCOUNTING
NAME OF THE STUDENT
NAME OF THE UNIVERSITY
AUTHOR NOTE

1Diploma In Accounting
Journal entries
Date particulars Debit Credit
2 Aug Direct materials …. 158400
Delivery cost … 1584
To Accounts payable 159984
(To direct materials purchased on credit)
3 Aug Factory overhead invoices 1650
To Account payables 1650
(To factory overhead charged in credit)
8 Aug Factory wages … 50000
To Bank 50000
(To wages being paid and allocated)
10 Aug Work-in-progress A/c 108200
To Direct materials 108200
(To direct materials used in production)
12 Aug Direct Materials 139464
To accounts payable 139464
(To direct materials purchase on credit)
15 Aug Accounts receivables 17600
To factory cleaning overhead 17600

2Diploma In Accounting
(To factory cleaning invoices received in credit)
18 Aug Accounts payable 11970
To Direct materials 11970
(To material purchased on 12 Aug has been returned)
22 Aug factory wages 60000
To Bank 60000
(To wages being paid and allocated)
24 Aug Work-in-progress 122734
To Direct materials 122734
(To materials used in production on the FIFO basis)
28 Aug Accounts receivables 13200
To Advertising 13200
(To advertising account received on credit)
31 Aug Finished goods 316747.2
To work-in-progress 316747.2
(To 80% of the work-in-progress is finished)
31 Aug Accounts receivables 537701
To sales 537701
(To credit sale with a markup of 40% above cost on 90% of the goods in store)
Overhead Variance Report
Overheads Variance Report
Standard Actual Variance
Depreciation 100000 270000 170000.00
Factory overhead 36546.00 45540 8994.00
Overhead Variance can be understood as the difference between the standard cost of
overhead allowed for the actual output accomplished and actual cost incurred over the overheads.

3Diploma In Accounting
The variation has been derived in the depreciation comparing the standard or depreciation
of the previous years over the depreciation in the current year. While the actual factory overhead
has been derived taking $4 a unit of the total units used in production.