A Firm That Has Implemented JIT Had the Following Transactions

question 67

Multiple Choice

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?

• A) Materials and In Process Inventory 40,000
• Work-in-process Inventory 40,000
• B) Materials Inventory 40,000
• Accounts Payable 40,000
• C) Work-in-Process Inventory 40,000
• Materials and In Process Inventory 40,000
• D) Work-in-Process Inventory 40,000
• Materials Inventory 40,000

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Definitions:

Freecycling

The practice of giving away unwanted items for free rather than disposing of them, to promote reuse and reduce waste.

TQM (Total Quality Management)

A management approach focused on continuous improvement of all organizational processes, products, and services.

Gemba

A Japanese term meaning "the actual place," often used in business to refer to the place where value is created or where the work is done, stressing the importance of understanding firsthand information.

Transumer

A consumer who prioritizes experiences over possessions and often engages in temporary use or rental of goods rather than ownership.