We know how to calculate the variances, and the variances are recorded in specific general ledger accounts. Then we can overcarrying the variances at end of every month.
Direct Material Price Variance
If the variance amounts are debit balance:
| Account Name |
Debit |
Credit |
| Cost of Goods Sold |
variance amounts |
|
| Direct Material Price Variance |
|
variance amounts |
If the variance amounts are credit balance:
| Account Name |
Debit |
Credit |
| Cost of Goods Sold |
|
variance amounts |
| Direct Material Price Variance |
variance amounts |
|
Select one of month then click 
under "Overcarrying" tab in "Accounting" box and "GL" module:
The following screen will show up:
Then click 
, you will get a warning message, click "OK" to continue:
Then a new transaction will show up:
Direct Material Usage Variance
If the variance amounts are debit balance:
| Account Name |
Debit |
Credit |
| Cost of Goods Sold |
variance amounts |
|
| Direct Material Usage Variance |
|
variance amounts |
If the variance amounts are credit balance:
| Account Name |
Debit |
Credit |
| Cost of Goods Sold |
|
variance amounts |
| Direct Material Usage Variance |
variance amounts |
|