Problem No.

1
ABC Manufacturing Company has the following account balances at the beginning of the current year:
Raw materials inventory 50,000.00
Work in process inventory 150,000.00
Finished good inventory 120,000.00

Below is the summary of transactions for the month of April:

a) Purchased raw materials:
on account 200,000
cash 80,000

b) Issuance of raw materials to the production dept, P180,000 of which 10% is indirect materials.
c) Payroll for the month:
Direct labor 120,000
Indirect labor 25,000
Marketing payroll 40,000
Administrative payroll 80,000
d) The following were accrued at the end of the month 50% 20% 30%
Electricity cost 22,000 11,000 4,400 6,600
Rent 10,000 5,000 2,000 3,000
Taxes and permits 5,000 2,500 1,000 1,500
Of the given expenses, 50% is allocated to factory, 20% to marketing, and 30% to administrative.
e) Depreciation for the month:
Factory plant & equip. 7,500
Office furn. & equip. 7,500
f) Expired insurance, P10,000, allocated in the same manner as in (d) 5,000 2000
g) Overhead is applied to production
h) At the end of the month, unfinished jobs totalled P75,000 and unsold finished goods amounting to P90,000.
i) It uses the actual cost system in accumulating cost and perpetual inventory system in accounting for its
inventory. Its mark-up on cost is maintained at 40% for the past two years all on a 30-day term.

Required: Determine the following:

1 Raw materials inventory, April 30 150,000 Raw material used:
2 Direct materials charged to the job 162,000 Raw materials invty, beg
3 Total prime costs for the period 282,000 + Raw materials invty
4 Amount of overhead charged to the job 74,000 TRMAU
5 Cost of goods manufactured 431,000 -Raw materials, end
6 Cost of goods sold 461,000 Raw materials used
7 Selling price of the goods sold 645,400
8 Total administrative and marketing costs 101,600 49,400 Raw materials issued
9 Net income for the period Less: Indirect materials (10%)
Direct materials used
Journalize the entries
Direct materials
Prepare a Statement of Cost of Goods manufactured and sold Direct labor
Total prime cost

Factory overhead
Indirect labor
Factory utilities
Rent
Taxes and permits
Insurance
Depreciation-factory & equip
Indirect materials
total FOH

Raw materials used

Direct labor
FOH
Total manufacturing cost
Add: Work in process, beg
Total cost placed in process
Less: Work in process, end
Cost of goods manufactured

Cost of goods manufactured

Add: Finished goods, beg
TGAS
Less: Finished goods, end
Cost of Goods Sold

Cost of goods sold

multiply by 140% = Selling price

utilities
Rent
Taxes and permits
Insurance
Depreciation-office & equ
salaries
Total

Sales
Cost of goods sold
Gross profit
less: Administrative
Marketing
Net Income
ministrative.

3000

ng to P90,000.

Raw materials invty, beg 50,000

+ Raw materials invty 280,000
330,000
-Raw materials, end 150,000
Raw materials used 180,000

180,000
materials (10%) 18,000
162,000

162,000
120,000
 282,000

25,000
11,000
5,000
2,500
5,000
factory & equip 7,500
18,000
74,000

162,000
120,000
74,000
cturing cost 356,000
process, beg 150,000
ced in process 506,000
process, end 75,000
manufactured 431,000

manufactured 431,000
goods, beg 120,000
551,000
d goods, end 90,000
461,000

461,000
40% = Selling price 645,400

Administrative Marketing
6,600 4,400
3,000 2,000
1,500 1,000
3,000 2,000
7,500
80,000 40,000
101,600 49,400

645,400
461,000
184,400
101,600
49,400 151,000
33,400
Problem No. 1
Carpentry Manufacturing Company has the following account balances at the beginning of the current year:
Beginning Ending
Direct materials 174,000.00 132,000.00
Work in process 311,500.00 289,750.00
Finished good 192,000.00 255,000.00

Below is the summary of transactions for the period:

a) Purchases:
Direct materials 1,500,000
Factory supplies 60,000

b) Supervision fee 175,000

c) Direct labor hours worked, 21,000 @ P45, excluding 1,000 hours overtime. The company's policy on
overtime is time and a half.
d) Other factory overhead including factory supplies used of P25,000 but excluding overtime premium is P300,000.
e) Actual overhead is applied to the job.

XYZ Manufacturing Company has the following account balances at the beginning of the current year:
Raw materials used in production 326,000
Prime costs for the period 551,000
Conversion cost for the period 360,000
( Overhead applied is equal to 60% of direct labor)
Cost of goods available for sale 826,000
Selling and administrative expenses 25,000
Inventories Beginning Ending
Raw materials 75,000 85,000
Work in process 80,000 30,000
Finished goods 90,000 110,000

The following cost information is available from the records of Delta Corporation for the year ended Dec. 31, 2021:
Inventories January 1, 2021
Finished goods 2,400,000
Work in process 3,000,000
Raw materials 4,400,000
Store supplies 850,000
Office supplies 150,000
Purchases:
Raw materials
Store supplies
Office supplies
Other costs and expenses:
Salaries and benefits:
 Direct labor
Indirect labor
Supervision fee
Administrative and selling
Depreciation (60%-factory; 40% adm. & selling)
Rent (60%-factory; 40% adm. & selling)
Utilities (60%-factory; 40% adm. & selling)
Advertising
Factory supplies used
Additional information:
The company applies actual overhead to production and sells their produce at a price to give the
company a gross profit of 25%.

Extra Company used the periodic inventory system in accounting for raw materials. The following data are
available during the period:
Raw materials purchases 37,500
Raw materials available for used 47,500
Raw materials issued to production 30,000
ng of the current year:

mpany's policy on

ertime premium is P300,000.

he current year:

he year ended Dec. 31, 2021:

December 31, 2021
2,950,000
2,400,000
2,800,000
700,000
280,000

9,000,000
1,200,000
850,000
 6,500,000
560,000
1,250,000
2,360,000
1,500,000
1,200,000
600,000
320,000
850,000

at a price to give the

he following data are

1 Raw material used:
Raw materials invty, beg 50,000
+ Raw materials invty 280,000
TRMAU 330,000
-Raw materials, end 150,000
Raw materials used 180,000

2 Raw materials issued 180,000

Less: Indirect materials (10%) 18,000
Direct materials used 162,000

3 Direct materials 162,000

Direct labor 120,000
Total prime cost 282,000

4 Factory overhead
Indirect labor 25,000
Factory utilities 11,000
Rent 5,000
Taxes and permits 2,500
Insurance 5,000
Depreciation-factory & equip 7,500
Indirect materials 18,000
total FOH 74,000

5 Raw materials used 162,000

Direct labor 120,000
FOH 74,000
Total manufacturing cost 356,000
Add: Work in process, beg 150,000
Total cost placed in process 506,000
Less: Work in process, end 75,000
Cost of goods manufactured 431,000

6 Cost of goods manufactured 431,000

Add: Finished goods, beg 120,000
TGAS 551,000
Less: Finished goods, end 90,000
Cost of Goods Sold 461,000

Administrative Marketing
7 utilities 6,600 4,400
Rent 3,000 2,000
 Taxes and permits 1,500 1,000
Insurance 3,000 2,000
Depreciation-office & equip 7,500
salaries 80,000 40,000
Total 101,600 49,400

8 Sales 645,400
Cost of goods sold 461,000
Gross profit 184,400
less: Administrative 101,600
Marketing 49,400 151,000
Net Income 33,400
Net Sales Understated
Less: Cost of Goods Sold
Raw materials invty, beg
+ Raw materials purchases
Total raw materials Available for Use
-Raw materials, end
Raw materials used Understated
Add: Direct labor
Factory Overhead
Total manufacturing cost
add: Work in process, beg.
Total goods paced in process
less: Work in process, end understated
Total cost of good manufactured
add: finished goods, beg.
Total goods avaiable for sale
less: Finished goods, end
Total Cost of Good Sold Understated Overstated

Gross Profit Understated Overstated Understated

Less: Operating expenses

Net Income Understated Overstated Understated

Overstated
Understatec

Overstated

Understated

Overstated Overstated