Chapter 20, Problem 20.29E

Backflush costing, two trigger points, completion of production and sale (continuation of 20-27). Assume the same facts as in Exercise 20-27, except now Grand Devices uses only two trigger points for making entries in the accounting system:

• Completion of good finished units of product
• Sale of finished goods

The inventory account is confined solely to finished goods. Any under- or overallocated conversion costs are written off monthly to Cost of Goods Sold.

1. 1. Prepare summary journal entries for August, including the disposition of under- or overallocated conversion costs.

Required

1. 2. Post the entries in requirement 1 to T-accounts for Finished Goods Control, Conversion Costs Control, Conversion Costs Allocated, and Cost of Goods Sold.