Mitchell Manufacturing operates in a just-in-time (JIT) manufacturing environmen
ID: 2361528 • Letter: M
Question
Mitchell Manufacturing operates in a just-in-time (JIT) manufacturing environment. Mitchell's actual conversion costs for the month of April follow:Direct and indirect labor $120,000
Machine depreciation 85,000
Maintenance and supplies 60,000
Total conversion costs $265,000
The journal entry to record April's conversion costs will include:
A. a debit to Work in Process Inventory
B. a debit to Raw Materials Inventory
C. a credit to Raw and In Process Inventory
D. a debit to Raw and In Process Inventory
Explanation / Answer
Answer: D Just-in-Time Production-Each part is produced immediately as needed by the next step in the production line.