What is the amount to be backflushed from RIP to finished goods?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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What is the amount to be backflushed from RIP to finished goods?

Transcribed Image Text:The Backflushers Manufacturing Corp. uses a Raw and In Process Inventory account and
expenses all conversion costs to the cost of goods sold account. At the end of each month, all
inventories are counted, their conversion cost components are estimated and inventory account
balances are adjusted accordingly. Raw material cost is backflushed from RIP to finished goods.
The following information is for the month of May:
Raw and In Process inventory account, May 1, including P500 of conversion
P 5,000
cost
Raw materials received during May (50% down, balance in four installments)
100,000
Raw and In Process inventory account, May 31, including P650 of estimated
conversion cost
5,250
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