PROBLEM 5 Pitato Company produces well known snacks, crackers, and potato chips for end-consumers which takes 4 hours of manufacture time each batch. Pitato Company 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 and no beginning or ending work-in- process inventories. The following data are for November 2021: Direct materials purchased $3,200,000 Direct materials used $3,150,000 Conversion costs incurred $800,000 Conversion costs allocated $750,000 Pitato Company has no direct material variances. When finished goods are sold, the backflush costing system pulls through standard direct materials cost ($105 per unit) and standard conversion cost ($25 per unit). Pitato Company produced 30,000 finished units in November 2021 and sold 29,500 units. The actual direct materials cost per unit in August 2017 was $105, and the actual conversion cost per unit was $23 Any under- or overallocated conversion costs are written off monthly to Cost of Good Sold PROBLEM 5 Pitato Company produces well known snacks, crackers, and potato chips for end-consumers which takes 4 hours of manufacture time each batch. Pitato Company 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 and no beginning or ending work-in- process inventories. The following data are for November 2021: Direct materials purchased $3,200,000 Direct materials used $3,150,000 Conversion costs incurred $800,000 Conversion costs allocated $750,000 Pitato Company has no direct material variances. When finished goods are sold, the backflush costing system pulls through standard direct materials cost ($105 per unit) and standard conversion cost ($25 per unit). Pitato Company produced 30,000 finished units in November 2021 and sold 29,500 units. The actual direct materials cost per unit in August 2017 was $105, and the actual conversion cost per unit was $23 Any under- or overallocated conversion costs are written off monthly to Cost of Good Sold