Doll Computer manufactures laptop computers under its own brand, but acquires all the components from outside vendors. No computers are assembled until the order is received online from customers, so there is no finished goods inventory. When an order is received, the bill of materials required to fill the order is prepared automatically and sent electronically to the various vendors. All components are received from vendors within three days and the completed. order is shipped to the customer immediately when completed, usually on the same day the components are received from vendors. The number of units in process at the end of any day is negligible. The following data are provided for the most recent month of operations: Actual components costs incurred Actual conversion costs incurred Units in process, beginning of month Units started in process during the month Units in process, end of month (a) Assuming Doll uses traditional cost accounting procedures: 1. How much cost was charged to Work-in-Process during the month? (b) Assuming Doll is a lean production company and uses backflush costing method: 1. How much cost was charged to cost of goods sold during the month? $925,000 $ 203,000 -0- 5,500 -0-
Doll Computer manufactures laptop computers under its own brand, but acquires all the components from outside vendors. No computers are assembled until the order is received online from customers, so there is no finished goods inventory. When an order is received, the bill of materials required to fill the order is prepared automatically and sent electronically to the various vendors. All components are received from vendors within three days and the completed. order is shipped to the customer immediately when completed, usually on the same day the components are received from vendors. The number of units in process at the end of any day is negligible. The following data are provided for the most recent month of operations: Actual components costs incurred Actual conversion costs incurred Units in process, beginning of month Units started in process during the month Units in process, end of month (a) Assuming Doll uses traditional cost accounting procedures: 1. How much cost was charged to Work-in-Process during the month? (b) Assuming Doll is a lean production company and uses backflush costing method: 1. How much cost was charged to cost of goods sold during the month? $925,000 $ 203,000 -0- 5,500 -0-
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Doll Computer manufactures laptop computers under its own brand, but acquires all the components from outside
vendors. No computers are assembled until the order is received online from customers, so there is no finished goods
inventory. When an order is received, the bill of materials required to fill the order is prepared automatically and sent
electronically to the various vendors. All components are received from vendors within three days and the completed
order is shipped to the customer immediately when completed, usually on the same day the components are received
from vendors. The number of units in process at the end of any day is negligible.
The following data are provided for the most recent month of operations:
Actual components costs incurred
Actual conversion costs incurred
Units in process, beginning of month
Units started in process during the month
Units in process, end of month
(a) Assuming Doll uses traditional cost accounting procedures:
1. How much cost was charged to Work-in-Process during the month?
(b) Assuming Doll is a lean production company and uses backflush costing method:
1. How much cost was charged to cost of goods sold during the month?
$ 925,000
$ 203,000
-0-
5,500
-0-
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