The standard cost of Item 285 manufactured by Lemon Company includes 3 pounds of direct materials at $6.00 per pound. During July, 60,000 pounds of direct materials are purchased at a cost of $5.55 per pound, and all of the direct materials are used to produce 19,000 units of Item 285.
Instructions (a) Compute the materials price and quantity variances. (b) Journalize the purchase of the materials and the issuance of the materials, assuming a standard cost system is used.