Back-flush accounting is a simpler method of costing and gets rid or unnecessary costing records. It is suitable for Just-In-Time (JIT) enviroment. JIT company holds minimal amout of stock and have the finished goods delivered immediately so that the amount of finished goods held are minimal.
Advantages:
1. simple
2. reduce cost
Disadvantages:
1. only suitable in JIT enviroment
2. need more trainning
3. Records are minimal, very hard 2 compare variance information
f5 : Back-flush Accounting
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