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20-23 Backflush costing and JIT production. Road Warrior Corporation assembles handheld computers that have scaled-down capabilities of laptop computers. Each handheld computer takes six hours
20-23 Backflush costing and JIT production. Road Warrior Corporation assembles handheld computers that have scaled-down capabilities of laptop computers. Each handheld computer takes six hours to assemble. Road Warrior uses a JIT production system and a backflush costing system with three trigger points: Purchase of direct materials - Completion of good finished units of product Sale of finished goods There are no beginning inventories of materials or finished goods. The following data are for August: Road Warrior records direct materials purchased and conversion costs incurred at actual costs. When finished goods are sold, the backflush costing system "pulls through" standard direct material cost (\$102 per unit) and standard conversion cost (\$28 per unit). Road Warrior produced 26,800 finished units in August and sold 26,400 units. The actual direct material cost per unit in August was \$102, and the actual conversion cost per unit was $27
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