Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
6th Edition
ISBN: 9780134486857
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 19, Problem 37AP
Low Range produces fleece jackets. The company uses JIT costing for its JIT production system.
Low Range has two inventory accounts: Raw and In-Process Inventory and Finished Goods Inventory. On March 1, 2018, the account balances were Raw and In-Process Inventory, $9,000; Finished Goods Inventory, $1,700.
The
Requirements
- 1. What are the major features of a JIT production system such as that of Low Range?
- 2. Prepare summary
journal entries for March. Underallocated or overallocated conversion costs are adjusted to Cost of Goods Sold monthly. - 3. Use a T-account to determine the March 31, 2018, balance of Raw and In-Process Inventory.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Dash Company adopted a standard costing system several years ago. The standard costs for the prime costs (i.e., direct
materials and direct labor) of its single product are:
$30.00
112.00
Material (6 kilograms x $5.00 per kilogram)
Labor (7 hours x $16.00 per hour)
All materials are added at the beginning of processing. The following data were taken from the company's records for
November:
In-process beginning inventory
In-process ending inventory 1,000
Units completed
7,600
Budgeted output
8,000
Purchases of materials
70,000
Total actual direct labor costs $ 850,000
Actual direct labor hours 57,400
Materials usage variance
$ 3,500
Total materials variance
$ 700
None
units, 70% complete as to direct labor
units
units
kilograms
hours
Unfavorable
Unfavorable
Required:
1. Compute for November:
a. The direct labor efficiency variance. Is this variance favorable (F) or unfavorable (U)?
b. The direct labor rate variance. Is this variance favorable (F) or unfavorable (U)?
c. The actual number…
CAVS Inc. employs weighted average process costing system regarding its cross-over protector product. The following data are provided for the year-ended December 31, 2020.
a. The January 1, 2020 work-in-process inventory consists of 4,000 units which have the following costs: P100,000-direct material, P250,000-direct labor and P150,000-factory overhead. The beginning inventory is 60% incomplete as to conversion cost.
b. The units started during the year totaled 6,000 units while the units completed during the period totaled 5,000 units.
c. The December 31, 2020 work-in-process inventory consists of 3,000 units which is 90% complete as to conversion cost.
d. The normal spoilage for the company is 20% of units started.
e. The total manufacturing costs added during the year consist of P2M-direct material, P1.5M-direct labor, and P1M-factory overhead.
f. The company inspects the products when the percentage of completion in conversion cost is 70%.
g. The company adds direct labor and…
Lally, Inc. produces universal remote controls. Lally uses a JIT costing system. One of the company's products has a standard direct materials cost of $9 per unit and a standard conversion cost of $35 per unit. During January 2018, Lally produced 500 units and sold 495 units on account at $45 each. It purchased $4,800 of direct materials on the account and incurred actual conversion costs totaling $14,000.
Requiremets :
1. Prepare summary jounal entries for January.
2. The January 1, 2018, balance of the Raw and In-Process inventory account was $70. Use a T - account to find the January 31 balance.
3. Use a T - account to determine wheither conversion costs are overallocated or unerallocated for the month. By how much? Prepare the journal entry to adjust the Conversion Costs account.
Chapter 19 Solutions
Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
Ch. 19 - The Santos Shirt Company manufactures shirts in...Ch. 19 - Prob. 2TICh. 19 - Prob. 3TICh. 19 - Prob. 4TICh. 19 - Prob. 5TICh. 19 - Prob. 6TICh. 19 - Prob. 7TICh. 19 - Prob. 8TICh. 19 - Prob. 9TICh. 19 - Prob. 10TI
Ch. 19 - Prob. 11TICh. 19 - Prob. 12TICh. 19 - Which statement is false? a. Using a single...Ch. 19 - Compute It uses activity-based costing. Two of...Ch. 19 - Compute It uses activity-based costing. Two of...Ch. 19 - Compute It uses activity-based costing. Two of...Ch. 19 - Compute It can use ABC information for what...Ch. 19 - Prob. 6QCCh. 19 - Companies enjoy many benefits from using JIT....Ch. 19 - Which account is not used in JIT costing? a....Ch. 19 - The cost of lost future sales after a customer...Ch. 19 - Spending on testing a product before shipment to...Ch. 19 - What is the formula to compute the predetermined...Ch. 19 - How is the predetermined overhead allocation rate...Ch. 19 - Describe how a single plantwide overhead...Ch. 19 - Why is using a single plantwide overhead...Ch. 19 - Why is the use of departmental overhead allocation...Ch. 19 - What is activity-based management? How is it...Ch. 19 - How many cost pools are in an activity-based...Ch. 19 - What are the four steps to developing an...Ch. 19 - Why is ABC usually considered more accurate than...Ch. 19 - List two ways managers can use ABM to make...Ch. 19 - Define value engineering. How is it used to...Ch. 19 - Explain the difference between target price and...Ch. 19 - How can ABM be used by service companies?Ch. 19 - What is a just-in-time management system?Ch. 19 - Explain how the work cell manufacturing layout...Ch. 19 - What are the inventory accounts used in JIT...Ch. 19 - How is the Conversion Costs account used in JIT...Ch. 19 - Prob. 18RQCh. 19 - Which accounts are adjusted for the underallocated...Ch. 19 - Prob. 20RQCh. 19 - Prob. 21RQCh. 19 - Prevention is much cheaper than external failure....Ch. 19 - What are quality improvement programs?Ch. 19 - Prob. 24RQCh. 19 - Prob. 1SECh. 19 - The Oakman (Company (see Short Exercise S19-1) has...Ch. 19 - Activity-based costing requires four steps. List...Ch. 19 - Prob. 4SECh. 19 - Darby Corp. is considering the use of...Ch. 19 - The following information is provided for Orbit...Ch. 19 - Jaunkas Corp. manufactures mid-fi and hi-fi stereo...Ch. 19 - Spectrum Corp. makes two products: C and D. The...Ch. 19 - Refer to Short Exercise S19-8. Spectrum Corp....Ch. 19 - Haworth Company is a management consulting firm....Ch. 19 - Refer to Short Exercise S19-10. Haworth desires a...Ch. 19 - Prob. 12SECh. 19 - Prime Products uses a JIT management system to...Ch. 19 - Stegall, Inc. manufactures motor scooters. For...Ch. 19 - Koehler makes handheld calculators in two models:...Ch. 19 - Koehler (see Exercise E19-15) makes handheld...Ch. 19 - Koehler (see Exercise E19-15 and Exercise E19-16)...Ch. 19 - Franklin, Inc. uses activity-based costing to...Ch. 19 - Turbo Champs Corp. uses activity-based costing to...Ch. 19 - Eason Company manufactures wheel rims. The...Ch. 19 - Refer to Exercise E19-20. For 2019, Easons...Ch. 19 - Refer to Exercises E19-20 and E19-21. Controller...Ch. 19 - Treat Dog Collars uses activity-based costing....Ch. 19 - Western, Inc. is a technology consulting firm...Ch. 19 - Refer to Exercise E19-24. The president of Western...Ch. 19 - Prob. 26ECh. 19 - Refer to Exercise E19-26. Western desires a 20%...Ch. 19 - Lally, Inc. produces universal remote controls....Ch. 19 - Prob. 29ECh. 19 - Darrel Co. makes electronic components. Chris...Ch. 19 - Prob. 31ECh. 19 - Prob. 32ECh. 19 - Willitte Pharmaceuticals manufactures an...Ch. 19 - The Alright Manufacturing Company in Rochester,...Ch. 19 - Oscar, Inc. manufactures bookcases and uses an...Ch. 19 - Blanchette Plant Service completed a special...Ch. 19 - Low Range produces fleece jackets. The company...Ch. 19 - Stella, Inc. is using a costs-of-quality approach...Ch. 19 - Harcourt Pharmaceuticals manufactures an...Ch. 19 - The Alexander Manufacturing Company in Rochester,...Ch. 19 - Martin, Inc. manufactures bookcases and uses an...Ch. 19 - Rennie Plant Service completed a special...Ch. 19 - High Mountain produces fleece jackets. The company...Ch. 19 - Roxi, Inc. is using a costs-of-quality approach to...Ch. 19 - Download an Excel template for this problem online...Ch. 19 - This problem continues the Piedmont Computer...Ch. 19 - Prob. 1TIATCCh. 19 - Harris Systems specializes in servers for...Ch. 19 - Harris Systems has decided to adopt ABC. To remain...Ch. 19 - Prob. 1EICh. 19 - Anu Ghai was a new production analyst at RHI,...
Additional Business Textbook Solutions
Find more solutions based on key concepts
What are assets limited as to use and how do they differ from restricted assets?
Accounting for Governmental & Nonprofit Entities
E6-14 Using accounting vocabulary
Learning Objective 1, 2
Match the accounting terms with the corresponding d...
Horngren's Accounting (11th Edition)
This year, Prewer Inc. received a 160,000 dividend on its investment consisting of 16 percent of the outstandin...
PRINCIPLES OF TAXATION F/BUS.+INVEST.
Preparing Financial Statements from a Trial Balance The following accounts are taken from Equilibrium Riding, I...
Fundamentals Of Financial Accounting
Bank loan; accrued interest LO132 On October 1, Eder Fabrication borrowed 60 million and issued a nine-month, ...
INTERMEDIATE ACCOUNTING
(a) Standard costs are the expected total cost of completing a job. Is this correct? Explain, (b) A standard im...
Managerial Accounting: Tools for Business Decision Making
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Chassen Company, a cracker and cookie manufacturer, has the following unit costs for the month of June: A total of 100,000 units were manufactured during June, of which 10,000 remain in ending inventory. Chassen uses the first-in, first-out (FIFO) inventory method, and the 10,000 units are the only finished goods inventory at June 30. Under the absorption costing concept, the value of Chassens June 30 finished goods inventory would be: a. 50,000. b. 70,000. c. 85,000. d. 145,000.arrow_forwardWebster Company uses backflush costing to account for its manufacturing costs. The trigger points for recording inventory transactions are the purchase of materials, the completion of products, and the sale of completed products. Required: 1. Prepare journal entries, if needed, to account for the followingtransactions. a. Purchased raw materials on account, 135,000. b. Requisitioned raw materials to production, 135,000. c. Distributed direct labor costs, 20,000. d. Incurred manufacturing overhead costs, 80,000. (Use Various Credits for the credit part of the entry.) e. Cost of products completed, 235,000. f. Completed products sold for 355,000, on account. 2. Prepare any journal entries that would be different from theabove, if the only trigger points were the purchase of materialsand the sale of finished goods.arrow_forwardDavis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the purchase of materials, the completion of goods, and the sale of goods. Prepare journal entries to account for the following: a. Purchased raw materials, on account, 70,000. b. Requisitioned raw materials to production, 70,000. c. Distributed direct labor costs, 15,000. d. Factory overhead costs incurred, 45,000. (Use Various Credits for the account in the credit part of the entry.) e. Completed all of the production started. f. Sold the completed production for 195,000, on account. (Hint: Use a single account for raw materials and work in process.)arrow_forward
- Kenkel, Ltd. uses backflush costing to account for its manufacturing costs. The trigger points are the purchase of materials, the completion of goods, and the sale of goods. Prepare journal entries to account for the following: a. Purchased raw materials, on account, 80,000. b. Requisitioned raw materials to production, 80,000. c. Distributed direct labor costs, 10,000. d. Factory overhead costs incurred, 60,000. (Use Various Credits for the account in the credit part of the entry.) e. Completed all of the production started. f. Sold the completed production for 225,000, on account.arrow_forwardOrman Company produces neon-colored covers for tablets (e.g., iPads). For last year, Orman reported the following: Last year, Orman produced 89,000 units and sold 90,500 units at 10.50 per unit. Required: 1. Prepare a statement of cost of goods manufactured. 2. Prepare an absorption-costing income statement.arrow_forwardSelected production and cost data of Amy's Craft Co. follow for May: View the production and cost data. On May31the Mixing Department ending Work-in-Process Inventory was 758omplete for materials and 25%omplete for conversion costs. The Heating Department ending Work-in-Process Inventory was 65%omplete for materials and 30%omplete for conversion costs. The company uses the weighted-average method. Read the requirements. Requirement 1. Compute the equivalent units of production for direct materials and for conversion costs for the Mixing Department. Complete the partial production cost report below for the Mixing Department, showing the equivalent units of production for direct materials and for conversion costs. Amy's Craft Co. Production Cost Report - Mixing Department (Partial) Month Ended May 31 UNITS Units accounted for: Total units accounted for Physical Units Equivalent Units Direct Materials Conversion Costs Production and Cost Data Units to account for: Beginning…arrow_forward
- Cetaphil Manufacturing Company uses a Raw and in Process (RIP) inventory account and charged to cost of sales all conversion costs. At the end of each month, all inventories are counted, their conversion costs components are estimated and inventory account balances are adjusted accordingly. backflushed from RIP to Finished goods. The following information is noted for Raw materials is the current month. • Beginning balance of RIP account, including P1,400 conversion costs, P31,200 Raw materials purchased on account, P367,000 Ending RIP inventory including P1,800 conversion cost, P33,000. 12. Give the final entry to adjust the accounts to their correct balances.arrow_forwardLakers Inc. employs weighted average process costing system regarding its cross-over protector product. The following data are provided for the year ended December 31, 2016: a. The January 1, 2016 work-in-process inventory consists of 4,000 units which have the following costs: P100,000-direct material, P250,000-direct labor and P150,000-factory overhead. The beginning inventory is 60% incomplete as to conversion cost.b. The units started during the year totaled 6,000 units while the units completed during the period totaled 5,000 units.c. The December 31, 2016 work-in-process inventory consists of 3,000 units which is 90% complete as to conversion cost.d. The normal spoilage for the company is 20% of units started.e. The total manufacturing costs added during the year consist of P2M-direct material, P1.5M –direct labor and P1M-factory overhead.f. The company inspects the products when the percentage of completion in conversion cost is 70%.g. The…arrow_forwardDash Company adopted a standard costing system several years ago. The standard costs for the prime costs (i.e., direct materials and direct labor) of its single product are: Material (5 kilograms × $5.00 per kilogram) $ 25.00 Labor (6 hours × $19.50 per hour) 117.00 All materials are added at the beginning of processing. The following data were taken from the company’s records for November: In-process beginning inventory None In-process ending inventory 800 units, 70% complete as to direct labor Units completed 6,400 units Budgeted output 6,800 units Purchases of materials 58,000 kilograms Total actual direct labor costs $ 750,000 Actual direct labor hours 41,000 hours Materials usage variance $ 2,300 Unfavorable Total materials variance $ 850 Unfavorable Required: 1. Compute for November: a. The direct labor efficiency variance. Is this variance favorable (F) or unfavorable (U)? b. The direct labor rate…arrow_forward
- Dash Company adopted a standard costing system several years ago. The standard costs for the prime costs (i.e., direct materials and direct labor) of its single product are: Material (8 kilograms × $5.00 per kilogram) $ 40.00 Labor (6 hours × $18.20 per hour) 109.20 All materials are added at the beginning of processing. The following data were taken from the company’s records for November: In-process beginning inventory None In-process ending inventory 800 units, 75% complete as to direct labor Units completed 5,600 units Budgeted output 6,000 units Purchases of materials 50,000 kilograms Total actual direct labor costs $ 600,000 Actual direct labor hours 36,500 hours Materials usage variance $ 1,500 Unfavorable Total materials variance $ 750 Unfavorable Required: 1. Compute for November: a. The direct labor efficiency variance. Is this variance favorable (F) or unfavorable (U)? b. The direct labor rate…arrow_forwardDash Company adopted a standard costing system several years ago. The standard costs for the prime costs (i.e., direct materials and direct labor) of its single product are: Material (8 kilograms × $5.00 per kilogram) $ 40.00 Labor (6 hours × $18.20 per hour) 109.20 All materials are added at the beginning of processing. The following data were taken from the company’s records for November: In-process beginning inventory None In-process ending inventory 800 units, 75% complete as to direct labor Units completed 5,600 units Budgeted output 6,000 units Purchases of materials 50,000 kilograms Total actual direct labor costs $ 600,000 Actual direct labor hours 36,500 hours Materials usage variance $ 1,500 Unfavorable Total materials variance $ 750 Unfavorable Required: 1. Compute for November: d. The actual price paid per kilogram of material during the month, the company calculates the direct materials price…arrow_forwardDash Company adopted a standard costing system several years ago. The standard costs for the prime costs (i.e., direct materials and direct labor) of its single product are: Material (5 kilograms × $5.00 per kilogram) $ 25.00 Labor (6 hours × $19.50 per hour) 117.00 All materials are added at the beginning of processing. The following data were taken from the company’s records for November: In-process beginning inventory None In-process ending inventory 800 units, 70% complete as to direct labor Units completed 6,400 units Budgeted output 6,800 units Purchases of materials 58,000 kilograms Total actual direct labor costs $ 750,000 Actual direct labor hours 41,000 hours Materials usage variance $ 2,300 Unfavorable Total materials variance $ 850 Unfavorable Required: 1. Compute for November: a. The direct labor efficiency variance. Is this variance favorable (F) or unfavorable (U)? b. The direct labor rate…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY