What are the major features of a jit production system

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Recording manufacturing costs for a JIT costing system

High Point produces fleece jackets. The company uses JIT costing for its JIT production system. High Point has two inventory accounts: Raw and in-process inventory and Finished goods inventory. On February 1, 2012, the account balances were Raw and in-process inventory, $7,000; Finished goods inventory, $2,200. The standard cost of a jacket is $37, comprised of $13 direct materials plus $24 conversion costs. Data for February's activities follow:

Number of jackets completed

20,000

Direct materials purchased

$ 257,500

Number of jackets sold

19,600

Conversion costs incurred

$ 580,000

Requirements

1. What are the major features of a JIT production system such as that of High Point?

2. Prepare summary journal entries for February. Under- or overallocated conversion costs are closed to Cost of goods sold monthly.

3. Use a T-account to determine the February 29, 2012, balance of Raw and in-process inventory.

Reference no: EM13515435

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