Traditional Costing

Traditional
Purchased raw materials on account for $160,000

Materials Inventory 160,000

Accounts Payable 160,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000
 Traditional
Placed all materials received into production.

WIP Inventory 160,000

Materials Inventory 160,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000

 Traditional
Incurred actual direct labor costs of $25,000

WIP Inventory 25,000

Wages Payable 25,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000

25000
 Traditional
Incurred actual overhead costs of $225,000.

Overhead Control 225,000

Misc. Accounts 225,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000 Actual

25000 225000
 Traditional
Applied Conversion Costs of $235,000

WIP Inventory 210,000

Overhead Control 210,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000 Actual Applied

25000 225000 210000

235000
 Traditional
Completed all work for the month.

Finished Goods 395,000

WIP Inventory 395,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000 Actual Applied

25000 395000 395000 225000 210000

235000
 Traditional
Sold all the completed work.

COGS 395,000
Finished Goods 395,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000 Actual Applied

25000 395000 395000 395000 225000 210000

235000
 Traditional
Computed the difference between actual and applied costs.

COGS 15,000
Overhead Control 15,000
Materials Inventory Work in Process Finished Goods Overhead Control

160000 160000 160000 Actual Applied

25000 395000 395000 395000 225000 210000

235000 15000
 Backflush Costing
(purchase raw materials and
completion of goods)
RIP Inventory Finished Goods
 Backflush Costing
(purchase raw materials and completion of goods)
Purchased raw materials on account for $160,000

RIP Inventory 160,000

Accounts Payable 160,000
RIP Inventory Finished Goods Conversion Cost Control

160000
 Backflush Costing
(purchase raw materials and completion of goods)
Placed all materials received into production.

No entry
 Backflush Costing
(purchase raw materials and completion of goods)
Incurred actual direct labor costs of $25,000

(See next slide)

 Backflush Costing
(purchase raw materials and completion of goods)
Incurred actual overhead costs of $225,000.

Conv. Cost Control 250,000

Wages Payable 25,000
Misc. Accounts 225,000
RIP Inventory Finished Goods Conversion Cost Control

160000

250000
 Backflush Costing
(purchase raw materials and completion of goods)
Applied Conversion Costs of $235,000

No entry
 Backflush Costing
(purchase raw materials and completion of goods)
Completed all work for the month.

Finished Goods 395,000

RIP Inventory 160,000
Conv. Cost Control 235,000
RIP Inventory Finished Goods Conversion Cost Control

160000 160000

395000 250000 235000

 Backflush Costing
(purchase raw materials and completion of goods)
Sold all the completed work.

COGS 395,000
Finished Goods 395,000
RIP Inventory Finished Goods Conversion Cost Control

160000 160000

395000 395000 250000 235000

 Backflush Costing
(purchase raw materials and completion of goods)
Computed the difference between actual and applied costs.

COGS 15,000
Conv. Cost Control 15,000
RIP Inventory Finished Goods Conversion Cost Control

160000 160000

395000 395000 250000 235000

15000
 Backflush Costing
(purchase raw materials and
sale of goods)
RIP Inventory
 Backflush Costing
(purchase raw materials and sale of goods)
Purchased raw materials on account for $160,000

RIP Inventory 160,000

Accounts Payable 160,000
RIP Inventory Conversion Cost Control

160000
 Backflush Costing
(purchase raw materials and sale of goods)
Placed all materials received into production.

No entry
 Backflush Costing
(purchase raw materials and sale of goods)
Incurred actual direct labor costs of $25,000

(See next slide)

 Backflush Costing
(purchase raw materials and sale of goods)
Incurred actual overhead costs of $225,000.

Conv. Cost Control 250,000

Wages Payable 25,000
Misc. Accounts 225,000
RIP Inventory Conversion Cost Control

160000

250000
 Backflush Costing
(purchase raw materials and sale of goods)
Applied Conversion Costs of $235,000

No entry
 Backflush Costing
(purchase raw materials and sale of goods)
Completed all work for the month.

No entry
 Backflush Costing
(purchase raw materials and sale of goods)
Sold all the completed work.

COGS 395,000
RIP Inventory 160,000
Conv. Cost Control 235,000
RIP Inventory Conversion Cost Control

160000 160000

250000 235000
 Backflush Costing
(purchase raw materials and sale of goods)
Computed the difference between actual and applied costs.

COGS 15,000
Conv. Cost Control 15,000
RIP Inventory Conversion Cost Control

160000 160000

250000 235000

15000
 Backflush Costing
(completion of goods)
Finished Goods
 Backflush Costing
(completion of goods)
Purchased raw materials on account for $160,000

No entry
 Backflush Costing
(completion of goods)
Placed all materials received into production.

No entry
 Backflush Costing
(completion of goods)
Incurred actual direct labor costs of $25,000

(See next slide)

 Backflush Costing
(completion of goods)
Incurred actual overhead costs of $225,000.

Conv. Cost Control 250,000

Wages Payable 25,000
Misc. Accounts 225,000
Finished Goods Conversion Cost Control

250000
 Backflush Costing
(completion of goods)
Applied Conversion Costs of $235,000

No entry
 Backflush Costing
(completion of goods)
Completed all work for the month.

Finished Goods 395,000

Accts. Payable 160,000
Conv. Cost Control 235,000

Finished Goods Conversion Cost Control

395000 250000 235000

 Backflush Costing
(completion of goods)
Sold all the completed work.

COGS 395,000
Finished Goods 395000
Finished Goods Conversion Cost Control

395000 395000 250000 235000

 Backflush Costing
(completion of goods)
Computed the difference between actual and applied costs.

COGS 15,000
Conv. Cost Control 15,000
Finished Goods Conversion Cost Control

395000 395000 250000 235000

Backflush Costing
(sale of goods)
 Backflush Costing
(sale of goods)
Purchased raw materials on account for $160,000

No entry
 Backflush Costing
(sale of goods)
Placed all materials received into production.

No entry
 Backflush Costing
(sale of goods)
Incurred actual direct labor costs of $25,000

(See next slide)

 Backflush Costing
(sale of goods)
Incurred actual overhead costs of $225,000.

Conv. Cost Control 250,000

Wages Payable 25,000
Misc. Accounts 225,000
Conversion Cost Control

250000
 Backflush Costing
(sale of goods)
Applied Conversion Costs of $235,000

No entry
 Backflush Costing
(sale of goods)
Completed all work for the month.

No entry
 Backflush Costing
(sale of goods)
Sold all the completed work.

COGS 395,000
Accts. Payable 160,000
Conv. Cost Control 235,000
Conversion Cost Control

250000 235000
 Backflush Costing
(sale of goods)
Computed the difference between actual and applied costs.

COGS 15,000
Conv. Cost Control 15,000
Conversion Cost Control

250000 235000

15000