Answer:
Debit Cost of Goods Sold $710
Credit Material Price Variance $40
Credit Material Usage Variance $225
Credit Labor Rate Variance $110
Credit Labor Efficiency Variance $335
Step-by-step explanation:
Preparation of the journal entry to be passed by Theta Company at the end of the month of February to close the variances
Debit Cost of Goods Sold $710
($40+$225+$110+$335)
Credit Material Price Variance $40
Credit Material Usage Variance $225
Credit Labor Rate Variance $110
Credit Labor Efficiency Variance $335
(To close the variances)
