Techno, a unit of Outdoor Corporation, manufactures a line of electric, cordless, lawn mowers. Senior management...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Techno, a unit of Outdoor Corporation, manufactures a line of electric, cordless, lawn mowers. Senior management of Outdoor Corporation has noticed that Techno has been producing more lawn mowers than it has been selling, and that the unit's Inventory has been steadily increasing. A (Click the icon to view additional information.) The following data are for Techno for March 2020: E (Click the icon to view the March data.) Read the requirements. Requirement 1. Prepare summary journal entries for March 2020 and post the etries to applicable T-accounts for both methods the current sequential tracking and the backflush costing that senior management of Outdoor Corporation is considering. (Record debits first, then credits. Exclude explanations from any joumal entries.) Begin by recording the entries Outdoor Corporation wouid use for the current sequential tracking, starting wilh the purchase of direct materiais. Journal Entry Date Accounts Debit Credit JE 1 Chaose from any list or enter any number in the input fields and then click Check Answer. 14 parts remaining Clear All Check Answer More Info Senior management of Outdoor Corporation suspects that the bonus plan in place for the head of Techno is behind this practice. Senior management of Outdoor Corporation is contemplating to switch from the current sequential tracking to a backflush costing system in order to stop the overproduction at Techno. Specifically, senior management of Outdoor Corporation is considering a backflush costing system with the following two trigger points: • Purchase of direct materials • Sale of finished goods Each mower takes 2 hours to assemble. There are no beginning inventories of materials or finished goods and no beginning or ending work-in-process inventories. Print Done Data Table Direct materials purchased $ 3,010,000 Conversion costs incurred $ 726,300 Direct materials used $ 2,894,400 Conversion costs allocated $ 562,800 Techno records direct materials purchased and conversion costs incurred at actual costs. It has no direct materials variances. When finished goods are sold, the backflush costing system "pulls through" standard direct materials cost ($108 per unit) and standard conversion cost ($21 per unit). Techno produced 26,800 finished units in March 2020 and sold 26,400 units. The actual direct materials cost per unit in March 2020 was $108, and the actual conversion cost per unit was $18. Any under- or overallocated conversion costs are written off monthly to Cost of Goods Sold. Print Done Requirements 1. Prepare summary journal entries for March 2020 and post the entries to applicable T-accounts for both methods the current sequential tracking and the backflush costing that senior management of Outdoor Corporation is considering. 2. Refer to your answer in requirement 1. How is operating income going to differ under backflush costing compared to the current sequential tracking? 3. Do you think that switching to the backflush costing system is going to accomplish the goal of Outdoor Corporation's senior management to stop the overproduction at Techno? Print Done Techno, a unit of Outdoor Corporation, manufactures a line of electric, cordless, lawn mowers. Senior management of Outdoor Corporation has noticed that Techno has been producing more lawn mowers than it has been selling, and that the unit's Inventory has been steadily increasing. A (Click the icon to view additional information.) The following data are for Techno for March 2020: E (Click the icon to view the March data.) Read the requirements. Requirement 1. Prepare summary journal entries for March 2020 and post the etries to applicable T-accounts for both methods the current sequential tracking and the backflush costing that senior management of Outdoor Corporation is considering. (Record debits first, then credits. Exclude explanations from any joumal entries.) Begin by recording the entries Outdoor Corporation wouid use for the current sequential tracking, starting wilh the purchase of direct materiais. Journal Entry Date Accounts Debit Credit JE 1 Chaose from any list or enter any number in the input fields and then click Check Answer. 14 parts remaining Clear All Check Answer More Info Senior management of Outdoor Corporation suspects that the bonus plan in place for the head of Techno is behind this practice. Senior management of Outdoor Corporation is contemplating to switch from the current sequential tracking to a backflush costing system in order to stop the overproduction at Techno. Specifically, senior management of Outdoor Corporation is considering a backflush costing system with the following two trigger points: • Purchase of direct materials • Sale of finished goods Each mower takes 2 hours to assemble. There are no beginning inventories of materials or finished goods and no beginning or ending work-in-process inventories. Print Done Data Table Direct materials purchased $ 3,010,000 Conversion costs incurred $ 726,300 Direct materials used $ 2,894,400 Conversion costs allocated $ 562,800 Techno records direct materials purchased and conversion costs incurred at actual costs. It has no direct materials variances. When finished goods are sold, the backflush costing system "pulls through" standard direct materials cost ($108 per unit) and standard conversion cost ($21 per unit). Techno produced 26,800 finished units in March 2020 and sold 26,400 units. The actual direct materials cost per unit in March 2020 was $108, and the actual conversion cost per unit was $18. Any under- or overallocated conversion costs are written off monthly to Cost of Goods Sold. Print Done Requirements 1. Prepare summary journal entries for March 2020 and post the entries to applicable T-accounts for both methods the current sequential tracking and the backflush costing that senior management of Outdoor Corporation is considering. 2. Refer to your answer in requirement 1. How is operating income going to differ under backflush costing compared to the current sequential tracking? 3. Do you think that switching to the backflush costing system is going to accomplish the goal of Outdoor Corporation's senior management to stop the overproduction at Techno? Print Done
Expert Answer:
Answer rating: 100% (QA)
Date Particulars Debit Credit Material and inprocess inventory controls ac Dr 3010000 To Accounts Pa... View the full answer
Related Book For
Elementary Statistics A step by step approach
ISBN: 978-0073386102
8th edition
Authors: Allan Bluman
Posted Date:
Students also viewed these accounting questions
-
Prepare summary journal entries to record the following transactions and events a through h for a company in its first month of operations. a. Raw materials purchased on account, $90,000. b. Direct...
-
Using Exhibit 19.12 as a guide, prepare summary journal entries to record the following transactions and events a through h for a company in its first month of operations. a. Raw materials purchased...
-
Prepare summary journal entries dated May 31 to record the following production activities during May: (a) raw materials purchases, (b) direct materials usage, (c) indirect materials usage, (d)...
-
Molybdenum forms a substitutional solid solution with tungsten. Compute the weight percent of molybdenum that must be added to tungsten to yield an alloy that contains 1.0 10 22 Mo atoms per cubic...
-
What semiannual sinking fund payment would be required to yield $48,000 nine years from now? The annual interest rate is 6% compounded semiannually?
-
Design a program that uses the following parallel arrays: empId: An array of seven Integers to hold employee identification numbers. The array should be initialized with the following numbers: The...
-
Part of the required input to the viscoelastic option in some finite element codes is a table showing the time-dependent, isotropic shear modulus \(G(t)\) at different times \(t\). Explain how you...
-
On January 1, 2013, Eagle borrows $ 100,000 cash by signing a four-year, 7% installment note. The note requires four equal total payments of accrued interest and principal on December 31 of each year...
-
Moran owns a building he bought during year 0 for $150,000. He sold the building in year 6. During the time he held the building, he depreciated it by $32,000. What are the amount and character of...
-
A MPV has seven passenger seats one in the front, and three in each of the other two rows. a. In how many ways can all 8 seats be filled from a party of 12 people, assuming that they can all drive?...
-
Pet information (derived classes) The base class Pet has private fields petName, and petAge. The derived class Dog extends the Pet class and includes a private field for dogBreed. Complete the main()...
-
Explain the Figure 68 and Figure 69 briefly. P Pricing and Output under Pure Competition INDUSTRY S -P C FIRM Profit ID MC Output in Million Figure 68: Purely Competitive Model with Few Firms AC 151...
-
Identify the domain of the following functions: a) f(x) = log(-2x+6) Domain: b) f(x) = ln(2x - 8) Domain: c) f(x) = log7(-3x - 2) Domain
-
What advanced interventions can organizations implement to address emotional intelligence deficits among employees, such as targeted coaching, training, or immersive experiential learning programs?
-
K Write a system of equations in x and y describing the situation. Do not solve the system. Keiko has a total of $5900, which she has invested in two accounts. The larger account is $800 greater than...
-
The accompanying image features two charged objects: a 1 . 0 ?m radius sphere with its center at the origin and a long straight rod parallel to the z - axis, passing through the point ( 0 , 2 , 0 ) ...
-
2. Using the information provided, estimate how much cash investment DermaCare will require until it can cover the costs of its Direct TV campaign. Use the excel sheet provided to come up with an...
-
Following is the current balance sheet for a local partnership of doctors: The following questions represent independent situations: a. E is going to invest enough money in this partnership to...
-
The distribution of ages of CEOs is as follows: Age Frequency 2130......1 3140......8 4150.....27 5160.....29 6170.....24 71up.....11 If a CEO is selected at random, find the probability that his or...
-
Fifty-eight percent of American children (ages 3 to 5) are read to every day by someone at home. Suppose 5 children are randomly selected. What is the probability that at least 1 is read to every day...
-
The county highway department recorded the following probabilities for the number of accidents per day on a certain freeway for one month. The number of accidents per day and their corresponding...
-
What are the differences among an onsite team, a virtual team, a task force, and a committee? What are some of the potential differences in dynamics between people in these different groups?
-
Compare and contrast disciplinary, interdisciplinary, and crossfunctional teams.
-
What are some of the unique challenges associated with teamwork in health care? How do you see teamwork fitting in with the accountable care organization (ACO) mandates? Describe three benefits and...
Study smarter with the SolutionInn App