Question
A firm uses backflush costing to assign product costs to inventory and values inventory using throughput accounting . All actual amounts are equal to budgeted
A firm uses backflush costing to assign product costs to inventory and values inventory using throughput accounting. All actual amounts are equal to budgeted amounts. The firm has no variable overhead.
Total DM | $1,500 |
Total DL | $500 |
Total Fixed OH | $300 |
Total complete & in process | 5,000 units |
Ending raw materials | $0 |
The firm has 35 units in finished goods inventory and 25 units in process.
Which journal entry appropriately backflushes costs to inventory accounts?
Group of answer choices
Debit: RIP $7.50
Debit: Finished Goods $10.50
Credit: COGS $18
Debit: RIP $10
Debit: Finished Goods $14
Credit: COGS $24
Debit: COGS $24
Credit: RIP $10
Credit: Finished Goods $14
Debit: COGS $18
Credit: RIP $7.50
Credit: Finished Goods $10.50
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