EBK CORNERSTONES OF COST MANAGEMENT
3rd Edition
ISBN: 8220100474972
Author: MOWEN
Publisher: CENGAGE L
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Textbook Question
Chapter 11, Problem 15E
Potter Company has installed a JIT purchasing and manufacturing system and is using back-flush accounting for its cost flows. It currently uses a two-trigger approach with the purchase of materials as the first trigger point and the completion of goods as the second trigger point. During the month of June, Potter had the following transactions:
There were no beginning or ending inventories. All goods produced were sold with a 60 percent markup. Any variance is closed to Cost of Goods Sold. (Variances are recognized monthly.)
Required:
- 1. Prepare the
journal entries that would have been made using a traditional accounting approach for cost flows. - 2. Prepare the journal entries for the month using backflush costing.
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Maney Televisions utilizes a traditional overhead allocation method, and has determined that overhead costs are driven by direct labor hours. Relevant cost information is provided below.
Total estimated overhead costs
$650,000
Total estimated DL hours
130,000
Actual overhead costs
$640,300
Actual DL hours
127,500
The unadjusted cost of goods sold balance at the end of the year is $56,000.
What is the overhead variance? Please provide your answer as a positive number rounded to the nearest whole dollar.
Please help me with show all calculation thanku
Yohan Company has the following balances in its direct materials and
direct labor variance accounts at year-end:
Direct Materials Price
Debit
Credit
Variance
$1,000
Direct Materials Quantity
$2,000
Variance
$500
Direct Labor Rate Variance
$3,000
Direct Labor Efficiency
Variance
Unadjusted Cost of Goods Sold equals $200,000. Which of the following
would be FALSE when the year-end closing entry is made?
O The Cost of Goods Sold account will be debited.
O Adjusted Cost of Goods Sold will be $198,500.
The Direct Labor Rate Variance account will be debited.
O The Direct Materials Price Variance account will be credited.
Chapter 11 Solutions
EBK CORNERSTONES OF COST MANAGEMENT
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