For June, there were no beginning inventories of raw materials and no beginning and ending work in process. Ronowski uses a JIT production system and backflush costing with three trigger points for making entries in its accounting system:
◆ Purchase of direct (raw) materials
◆ Completion of good finished units of product
◆ Sale of finished goods
Ronowski’s June standard cost per unit of telephone product is direct materials, $31.20; conversion costs, $18. There are three inventory accounts:
◆ Inventory: Raw
◆ Inventory: In-Process Control
◆ Finished Goods Control
The following data apply to June manufacturing:
Raw materials purchased......... $6,360,000
Conversion costs incurred.......... $3,696,000
Number of finished units manufactured...... 200,000
Number of finished units sold .......... 192,000
REQUIRED
1. Prepare summary journal entries for June (without disposing of under- or overallocated conversion costs). Assume no direct materials variances.
2. Post the entries in requirement 1 to T-accounts for applicable Inventory Control,
Conversion Costs Control, Conversion Costs Allocated, and Cost of Goods Sold.