Solution-Records the incurrence of conversion costs

Records the incurrence of conversion costs

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Reference no: EM132873186

Question - Fun 'N' Games manufactures various board games. For January there were no beginning inventories of direct materials, and no beginning or ending work-in-process. Only one indirect manufacturing cost category is currently in use, "Conversion Costs." Journal entries are recorded when materials are purchased and when conversion costs are allocated under backflush costing.

Actual Conversion costs - January $400,000

Direct materials purchased - January $1,070,000

Units produced - January 58,800

Units sold - January 41,800

Which of the journal entries properly records the incurrence of conversion costs?

a. Cost of Goods Sold 400,000

Conversion Costs 400,000

b. Conversion Costs 400,000

Various accounts 400,000

c. Inventory: Direct Materials 400,000

Conversion Costs 400,000

d. Conversion Costs 400,000

Inventory: Direct Materials 400,000

e. Various accounts 400,000

Conversion Costs 400,000

Reference no: EM132873186

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Records the incurrence of conversion costs

Reference no: EM132873186

Reference no: EM132873186

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