Merritt Company uses a process cost system of accounting for the following transactions.

1. Merritt Company uses a process cost system of accounting for the following transactions. Journalize the entries using general journal format.1. Purchased $100,000 of raw materials on credit.2. Used $40,000 of direct materials in production.3. Used $10,000 of indirect materials.4. Incurred total labor cost of $80,000, paid in cash.5. Used $50,000 of direct labor in production.6. Used $8,000 of indirect labor.7. Paid cash for overhead costs, other than indirect materials and indirect labor, of $12,0008. Transferred completed products with a cost of $78,000 to finished goods inventory.9. Sold $150,000 of products on credit. Their cost is $75,000. (two- part entry)2. Cricket Company produces many different types of pet toys. You have been hired as a cost accountant to do some basic cost analysis on several of their new products. It is also your responsibility to communicate your findings to a few of the people on the management team. Assume this team has no accounting experience.Cricket Company is considering the purchase of a new machine. This machine will produce two different kinds of floating dog toys used in retrieving exercises. The machine costs $5,000 and is the only fixed cost associated with the toys. Toy A will sell for $28 and has a variable cost of $18. Toy B will sell for $20 and has a variable cost of $5.1. What is the breakeven in units and dollars if Toy A is the only one produced?2. What is the breakeven in units and dollars if Toy B is the only one produced?3. If the company only produces Toy A and targets a profit of $10,000, how many units do they need to sell?4. Write a short memo to the management team explaining the meaning of break-even analysis. Includecontribution margin and illustrate that concept with an example using numbers.3. Below are numbers from Spectrum Company on a product during the first year of operations. During this first year the company produced 44,000 units and sold 36,000 units at a price of $140 per unit.Production costsDirect materials per unit $60Direct labor per unit $22Variable overhead per unit $8Fixed overhead for the year $528,000Selling and administrative costVariable selling and administrative cost per unit $11Fixed selling and administrative cost per year $105,0001. Determine the unit product cost using absorption costing.2. Determine the unit product cost using variable costing.3. Prepare an income statement for the year under absorption costing.4. Prepare an income statement for the year under variable costing.4. Melrose Manufacturing’s cost accountant produced the following information on production activities for the year:Actual raw materials used 16,000 pounds at $4.05 per poundActual factory payroll 5,545 hours for a total cost of $72,085Actual units produced 30,000Standard material per unit 0.50 poundsStandard price of material $4.15Standard direct labor per unit 10 minutesStandard direct labor rate $12.50 per hour1. Calculate the direct materials price variance.2. Calculate the direct materials quantity variance.3. Calculate the direct labor rate variance.4. Calculate the direct labor efficiency variance.You must indicate if each variance is favorable or unfavorable