Dutch Oven is a bakery company. All processing is in batches of 6 dozen. For March, there were no beginning inventories. Conversion costs and direct materials are the only baking cost accounts. Direct materials are purchased under a just-in-time system. The company uses backflush costing with three trigger points: at purchase of raw materials, completion of finished goods, and sale of finished goods. Additional information for the month is as follows:
Required:
Record all journal entries for the monthly activities related to the above transactions assuming that backflush costing is used. The company uses a standard costing system for recording the purchase and use of direct materials; and, the recording of conversion costs. Material price variances are recorded at the time of purchase then closed to cost of goods sold; all other variances are recorded at the completion of finished goods trigger point as a direct charge, or credit to Cost of Goods Sold.

Question

Dutch Oven is a bakery company. All processing is in batches of 6 dozen. For March, there were no beginning inventories. Conversion costs and direct materials are the only baking cost accounts. Direct materials are purchased under a just-in-time system. The company uses backflush costing with three trigger points: at purchase of raw materials, completion of finished goods, and sale of finished goods. Additional information for the month is as follows:
  Required:
Record all journal entries for the monthly activities related to the above transactions assuming that backflush costing is used. The company uses a standard costing system for recording the purchase and use of direct materials; and, the recording of conversion costs. Material price variances are recorded at the time of purchase then closed to cost of goods sold; all other variances are recorded at the completion of finished goods trigger point as a direct charge, or credit to Cost of Goods Sold.

Quizplus · Accepted Answer

The Answer of Dutch Oven is a bakery company. All processing is in batches of 6 dozen. For March, there were no beginning inventories. Conversion costs and direct materials are the only baking cost accounts. Direct materials are purchased under a just-in-time system. The company uses backflush costing with three trigger points: at purchase of raw materials, completion of finished goods, and sale of finished goods. Additional information for the month is as follows:
  Required:
Record all journal entries for the monthly activities related to the above transactions assuming that backflush costing is used. The company uses a standard costing system for recording the purchase and use of direct materials; and, the recording of conversion costs. Material price variances are recorded at the time of purchase then closed to cost of goods sold; all other variances are recorded at the completion of finished goods trigger point as a direct charge, or credit to Cost of Goods Sold.

Dutch Oven Is a Bakery Company