Concept explainers
High Mountain produces fleece jackets. The company uses JIT costing for its JIT production system.
High Mountain has two inventory accounts: Raw and In-Process Inventory and Finished Goods Inventory. On April 1, 2018, the account balances were Raw and In-Process Inventory, $10,000; Finished Goods Inventory, $2,100.
The
Requirements
- 1. What are the major features of a JIT production system such as that of High Mountain?
- 2. Prepare summary
journal entries for April. Underallocated or overallocated conversion costs are adjusted to Cost of Goods Sold monthly. - 3. Use a T-account to determine the April 30, 2018, balance of Raw and In-Process Inventory.
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