A firm uses backflush costing and values inventory using direct costing. All actual amounts are equal to budgeted amounts. (Note that some of the amounts below are on a per unit basis.)

DM per unit $1.50 DL per unit $2.00 VOH per unit $0.45 FOH per unit $0.55 Total completed and in process 15,000 units Units in finished goods 500 Units in process 250

The firm counts raw materials at the end of the period and finds that $50 of raw materials are still in the warehouse. Which journal entry appropriately backflushes costs to inventory accounts?

Group of answer choices

a.

Debit: RIP $425

Debit: Conversion Costs $612.50

Debit: FG $1,975

Credit: COGS $3,012.50

b.

Debit: RIP $375

Debit: Conversion Costs $750

Debit: FG $2,250

Credit: COGS $3,375

c. Debit: COGS $3,012.50

Credit: RIP $425

Credit: Conversion Costs $612.50

Credit: FG $1,975

d.

Debit: COGS $3,375

Credit: RIP $375

Credit: Conversion Costs $750

Credit: FG $2,250