Asked by kkoln kkijknjn on Jul 05, 2024
Verified
Suza Inc.is a lean manufacturer of snow blowers.Each snow blower requires $300 of raw materials.Estimated conversion costs to produce 4,000 units in this year are $600,000.During the first six months of this year Suza produced 300 snow blowers and sold 280.Each snow blower is sold for $900.
Required
1.Compute the conversion rate per snow blower.
2.Prepare journal entries to record (a)the purchase of raw materials on credit,(b)applied conversion costs to production,(c)sale of snow blowers on credit,and (d)cost of goods sold and finished goods inventory.
Conversion Rate
The percentage of users who take a desired action, often used in marketing to indicate the effectiveness of an advertising campaign or website design.
Conversion Costs
Costs incurred during the conversion of raw materials into finished goods, primarily comprising direct labor costs and manufacturing overhead.
- Understand the elements that constitute the total cycle duration and the impact of lean principles on cycle efficiency.
- Master the methodology for computing the final balance in finished goods inventory.
Verified Answer
HD
Learning Objectives
- Understand the elements that constitute the total cycle duration and the impact of lean principles on cycle efficiency.
- Master the methodology for computing the final balance in finished goods inventory.