Question
. The Action Corporation manufactures electrical meters. For May, there were no beginning inventories of raw materials and no beginning and ending work in process.
. The Action Corporation manufactures electrical meters. For May, there were no
beginning inventories of raw materials and no beginning and ending work in process.
Action uses JIT manufacturing system and backflush costing with three trigger points for
making entries in the accounting system:
Purchase of raw materials - debited to raw and in process account
Completion of finished goods - debited to finished goods account
Sale of finished goods
No. 13 - Continued
Action's May standard costs per meter are direct materials, p25; and conversion
costs, P20. The following data apply to May manufacturing:
Raw materials and components purchased
P550,000
Conversion costs incurred
P440,000
Number of finished units manufactured
21,000
Number of finished units sold
20,000
The balance of raw and in process and finished goods inventory accounts at the
end of May are:
a.
P25,000 and P945,000 respectively
b.
P550,00 and P45,000 respectively
c.
P25,000 and P45,000 respectively
d.
P550,000 and P945,000 res
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