Question
Com-Tel Inc. manufactures and assembles two models of smartphonesthe Tiger Model and the Lion Model. The process consists of a lean cell for each product.
Com-Tel Inc. manufactures and assembles two models of smartphonesthe Tiger Model and the Lion Model. The process consists of a lean cell for each product. The data that follow concern only the Lion Model lean cell.
For the year, Com-Tel Inc. budgeted these costs for the Lion Model production cell:
Conversion Cost Categories | Budget | ||
Labor | $113,300 | ||
Supplies | 42,900 | ||
Utilities | 15,400 | ||
Total | $171,600 |
Com-Tel plans 2,200 hours of production for the Lion Model cell for the year. The materials cost is $66 per unit. Each assembly requires 20 minutes of cell assembly time. There was no May 1 inventory for either Raw and In Process Inventory or Finished Goods Inventory.
The following summary events took place in the Lion Model cell during May:
- Electronic parts were purchased to produce 7,500 Lion Model assemblies in May.
- Conversion costs were applied for 7,150 units of production in May.
- 7,010 units were completed and transferred to finished goods in May.
- 6,800 units were shipped to customers at a price of $312 per unit.
If required, round your answers to the nearest cent.
Required:
1. Determine the budgeted cell conversion cost per hour. $ per hour
2. Determine the budgeted cell conversion cost per unit. $ per unit
3. Journalize the summary transactions (a) through (d). If an amount box does not require an entry, leave it blank.
a. | |||
b. | |||
3. | |||
4. Sale | |||
4. Cost | |||
4. Determine the ending balance in Raw and In Process Inventory and Finished Goods Inventory.
Raw and In Process Inventory | $ |
Finished Goods Inventory | $ |
5. Lean accounting is different from traditional accounting because it is more and uses control. As a result, the number of transactions are . In many lean operations, purchased materials are charged to a . Direct labor is . Often, nonfinancial performance measures, such as , are used to monitor performance.
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