3. Journalize the summary transactions (a) through (d). If an amount box does not require an entry, leave it blank. Raw and In Process Inventory Accounts Payable b. Raw and In Process Inventory Conversion Costs 3. Finished Goods Inventory Raw and In Process Inventory 4. Sale Accounts Receivable Sales 4. Cost Cost of Goods Sold Finished Goods Inventory Feedback Check My Work 3. In lean manufacturing, there are fewer transactions to record, thus simplifying the accounting system. Some accounts are combined. For example, all in-process work is combined with raw materials to form a new account, Raw and In Process (RIP) Inventory and direct labor is also combined with other costs to form a new account titled Conversion Costs. Indirect labor is directly assigned to product cells; thus, less factory overhead is allocated to products. The cell conversion rate is similar to a predetermined factory overhead rate, except that it includes all conversion costs in the numerator. 4. Determine the ending balance in Raw and In Process Inventory and Finished Goods Inventory. Raw and In Process Inventory: Finished Goods Inventory: 5. Lean accounting is different from traditional accounting because it is more simplified and uses minimal "raw and in process inventory" account V. Direct labor is included as a conversion cost of the cell control. As a result, the number of transactions are reduced. In many lean operations, purchased materials are charged to a V. Often, nonfinancial performance measures, such as lead time or quality measures , are used to monitor performance. Lean Accounting Com-Tel Inc. manufactures and assembles two models of smartphones-the Tiger Model and the Lion Model. The process consists of a lean cell for each product. The data that follow concern only the Lion Model lean cell. a For the year, Com-Tel Inc. budgeted these costs for the Lion Model production cell: Conversion Cost Categories Budget Labor $122,000 Supplies 49,000 Utilities 18,000 Total $189,000 Com-Tel plans 2,100 hours of production for the Lion Model cell for the year. The materials cost is $185 per unit. Each assembly requires 12 minutes of cell assembly time. There was no May 1 inventory for either Raw and In Process Inventory or Finished Goods Inventory. The following summary events took place in the Lion Model cell during May: a. Electronic parts were purchased to produce 900 Lion Model assemblies in May. b. Conversion costs were applied for 875 units of production in May. C. 850 units were completed and transferred to finished goods in May. d. 800 units were shipped to customers at a price of $500 per unit. Required: 1. Determine the budgeted cell conversion cost per hour. per hour 2. Determine the budgeted cell conversion cost per unit. per unit Feedback Check My Work 1. Cell Conversion Cost Rate = Budgeted Conversion Cost = Planned Hours of Production 2. Conversion Cost for Smartphone = Manufacturing Time x Cell Conversion Cost Rate