Right Now Video Inc. uses a lean manufacturing strategy to manufacture DVR (digital video recorder) players. The company manufactures DVR players through a single product cell. The budgeted conversion cost for the year is $420,000 for 2,000 production hours. Each unit requires 9 minutes of cell process time. During July, 1,100 DVR players are manufactured in the cell. The materials cost per unit is $135. The following summary transactions took place during July:

Jul.	1	Materials are purchased for July production.
	3	Conversion costs were applied to production.
	15	1,100 DVR players are assembled and placed in finished goods.
	25	1,060 DVR players are sold for $335 per unit.

Required:

A.

Determine the budgeted cell conversion cost per hour.

B.

Determine the budgeted cell conversion cost per unit.

C.

Journalize the summary transactions for July. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS

Right Now Video Inc.

General Ledger

	ASSETS
110	Cash
120	Accounts Receivable
125	Notes Receivable
140	Office Supplies
141	Store Supplies
142	Prepaid Insurance
150	Raw and In Process Inventory
151	Finished Goods Inventory
180	Land
190	Equipment
191	Accumulated Depreciation-Equipment

	LIABILITIES
210	Accounts Payable
216	Salaries Payable
218	Sales Tax Payable
219	Customers Refunds Payable
221	Notes Payable

	EQUITY
31	Common Stock
32	Retained Earnings
33	Dividends
34	Income Summary

	REVENUE
410	Sales

	EXPENSES
510	Cost of Goods Sold
511	Conversion Costs
521	Advertising Expense
523	Depreciation Expense-Equipment
526	Salaries Expense
531	Rent Expense
533	Insurance Expense
534	Store Supplies Expense
535	Office Supplies Expense
536	Credit Card Expense
539	Miscellaneous Expense
710	Interest Expense