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A firm that has implemented JIT had the following transactions:

13
A firm that has implemented JIT had the following transactions:
1. Materials were purchased on account for $40,000.
2. Materials were placed into production.
3. Actual direct labor costs were $6,000.
4. Actual overhead costs were $40,000.
5. Conversion costs applied were $42,000.
6. All work was completed for the month.
7. All completed work was sold.
8. The variance is recognized.

What will be the entry to record material placed into production using the traditional approach?

Materials and In Process Inventory 40,000
Work-in-process Inventory 40,000

Materials Inventory 40,000
Accounts Payable 40,000

Work-in-Process Inventory 40,000
Materials and In Process Inventory 40,000

Work-in-Process Inventory 40,000
Materials Inventory 40,000

14
Which of the following process dimensions of the activity-based management model deals with "why"?

a-resources

b-driver analysis

c-activities

d-performance measures

Question 15
_______________ are those activities necessary to remain in business.

a)Activity inputs

b)Activity outputs

c)Activity drivers

d)Value-added activities

Question 16
A time-and-motion study revealed that it should take 2 hours to produce a product that currently takes 6 hours to produce. Labor is $8 per hour.

The non-value-added costs are

a)$16.

b)$32.

c)$48.

d)$-0-.

Question 17
Each unit of product requires 16 pounds of material. Due to scrap and rework, each unit has been averaging 18 pounds of material. The material costs $6 per pound.

If the company wants to reduce non-value-added costs by 25 percent next year, the currently attainable standard for material would be

a)16.00 pounds.

b)16.80 pounds.

c)17.50 pounds.

d)18.00 pounds.

Solution Summary

A firm that has implemented JIT had the transactions are determined.

$2.19