Problem 3 The Santa Rosa Company that manufactures baby dolls seeks to streamline its costing system. It will use a backflush costing system with three trigger system points. Purchase of Raw materials Completion of units sSale of Finished Goods There are no beginning inventories. The following data pertains to April 2020: Raw Materials Purchased P440,000 425,000 211,000 200,000 625,000 595,000 Raw Materials used Conversion costs incurred Conversion costs applied Cost transferred to finished goods Costs of Goods sold Required: Prepare summary journal entries for April (without disposing of under-applied or over- pplied conversion costs). Assume no direct materials variances.

Problem 3 The Santa Rosa Company that manufactures baby dolls seeks to streamline its costing system. It will use a backflush costing system with three trigger system points. Purchase of Raw materials Completion of units sSale of Finished Goods There are no beginning inventories. The following data pertains to April 2020: Raw Materials Purchased P440,000 425,000 211,000 200,000 625,000 595,000 Raw Materials used Conversion costs incurred Conversion costs applied Cost transferred to finished goods Costs of Goods sold Required: Prepare summary journal entries for April (without disposing of under-applied or over- pplied conversion costs). Assume no direct materials variances.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please Answer part 4. Part 1-3 answers Part 1 Computation of Cost Allocation Rate for each activity: Activity Costs Base usage Allocation rate Material Handling 160,000 20,000 8 Packaging 390,000 2,000 195 Quality Assurance 112,000 1,600 70 Total 662,000 Part 2 Activity Usage of All Activities: Activity Commercial Travel Total Material Handling 8700 4450 13,150 Packaging 900 300 1,200 Quality Assurance 270 370 640 Allocation of Cost basis Usage: Activity Commercial Travel Material Handling 69,600 35600 (Activity Usage * Cost Allocation Rate) (8,700 * 8) (4450 * 8) Packaging 175,500 58500 Quality Assurance 18,900 25900 Total 264,000 120000 Units Produced 3,000 20000 Cost Per Unit 88 6 Part 3 Particulars Commercial Travel Usage of…
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Backflush Costing: Variation 2 Potter Company has installed a JIT purchasing and manufacturing system and is using backflush accounting for its cost flows. It currently uses a two-trigger approach with the purchase of materials as the first trigger point and the completion of goods as the second trigger point. During the month of June, Potter had the following transactions: Raw materials purchased $245,000 Direct labor cost 41,500 Overhead cost 207,500 Conversion cost applied 269,750* *$41,500 labor plus $228,250 overhead. There were no beginning or ending inventories. All goods produced were sold with a 60 percent markup. Any variance is closed to Cost of Goods Sold. (Variances are recognized monthly.) Required: Prepare the journal entries for the month of June using backflush costing, assuming that Potter uses the sale of goods as the second trigger point instead of the completion of goods. For a compound transaction, if an amount box does not require an entry, leave…