1

CHAPTER 2
Multiple Choice Questions Theoretical
1.
2.
3.
4.
5.

c
b
a
b
a

6.
7.
8.
9.
10.

b
c
b
b
a

11.
12.
13.
14.
15.

a
a
a
a
a

Multiple Choices - Computational

1.

(a)
10,000 x P500
10,000

2.

P1 x .20 x 10,000
2

(a)
1,000 + 1,500 = (100x 20) + SSQ
SSQ = 500 units

3.

(a)
EOQ =

2 x 5,200 x P250
P5

= 721
4.

(a)
5,200/721 = 7.2

5.

(a)
D = 10,000, P = P225, C = P225
EOQ =

2 DP
C

2 x 10,000 x P225
10

= 670.82
= 671 jerseys
6.

(a)
Number of orders per year =
=
=

D
EOQ
14.90
15 orders

10,000
671

P1,500

2
7.

(a)
Demand each
Working day

D
Number of working days

10,000
365
27.40 jerseys per day

Purchase lead time = 7 days

Reorder point
= 27.40 x 7
= 191.80 or 192 jerseys
8.

(a)
2

9.

x 50,000 x P5
P2

500

(a)
[(10,000 / 250) x 30]

+ [(70 - 30) x 40]

30 ( 10,000 / 250) + 40 ( 70 - 30) = 2,800

10.

11.

(a)
Safety
Stock

Expected
Stockout

Stockhout
Cost

10
20
50
55

2.5
1.5
.5
.25

P200
120
40
20

P 20
60
100
110

(a)
(1,400 - 600)

12.

Carrying
Cost

+ 2,000 = 2,800

(a)
P800
P.12 + P.10 + 10,000 = .30

13.

(a)
SS
OP

=
=

(7,200 / 2,400) x (45 20)

20 (7,200 / 240) + 750

= 750
= 1,350

Stockhout and
Carrying costs
P220
180
140
130

3
14.

(a)
2 x RU x CO
CU x CC
2 x 1,000 x P50
P100 x .15625
EOQ

6,400

= 6400
= 80
15.

(a)
Order Cost

= RU x CO
EOQ
= 1,000 x P50
80
= P625

16.

(a)
CC

17.

=
=
=

x EOQ x CU x CC
x 80
x P100 x .15625
P625

(a)
140 + (100 x 7 days) = 840

18.

(a)
140 + (1,000 / 2) = 640

19.

(a)
140 + 1,000 = 1,140

20.

(a)
1,000 =

2 x 25,000 x CO
P1

1,000 =

50,000 x CO

1,000,000 = P50,000 x CO
CO
= P20

4
21.

(a)
EOQ

22.

2 x 20,000 x P160
P1.60

2,000 yards.

(a)
20,000 / 2,000 = 10 order

23.

(a)
Demand each working day

=
=
=
=

Annual demand / No. of working days

20,000/250
80 yards per day
400 yards per weedl

Purchasing lead time

Reorder point

=
=

2 weeks
400 x 2 = 800 yards

SOLUTIONS TO PROBLEMS
Problem 2-1
1.

Purchase Order:
Big Manufacturers
123 Molave Street
Fairview Ave., QC

Purchase Order 144

Date 4/4/08

To:

Shipping Instructions
Date Wanted 4/17/08

Small Products
54 West Avenue
Cebu City

Quantity

Description

4,390
840
1,890

By

2.

103 2 x 4 plastic sheeting

122 3 x 5 plastic sheeting
142 4 x 6 plastic sheeting

Unit Price

Amount

P1.20
1.90
2.60

P5,268.00
1,596.00
4,914.00
P11,778.00

(Students Name)
Purchasing Agent

Charge: ACCT. 121

Job________
Dept. ______

Receiving Report
Big Manufacturers
123 Molave Street
Fairview Ave., QC

Receiving Report

Received From:

Date Received 4/4/08

Purchase Order No. 144
Invoice No.
539

Ship Via
Quantity
Received
4,390
84
1,890

Small Products
54 West Avenue
Cebu City

Fedex

Tansport Charges

Quantity
Accepted
4,250
840
1,890

Prepaid Received By

Quantity
Rejected
140
-0-0-

403

(Students Name)

Description

Weight

103-2x4 plastic sheeting

102-3x5 plastic sheeting
103-4x6 plastic sheeting

425 k
210 k
945 k

Inspection Record
Quantity
Accepted
4,250
Date

Quantity
Returned
140

Reason for Rejection

Imperfections in the sheets. Do not replace
Inspected by

( Students Name)

6
3.

4.

Debit Memorandum
Big Manufacturers
123 Molave Street
Fairview Ave., QC

Debit Memorandum No.

To:

Date
4/19/2008
Invoice No.
539
Invoice Date
4/17/2008

Small Products
54 West Avenue
Cebu City

Quantity

Purchase
Order No.

Description

Unit
Price

Amount

140

644

103 2 x 4 plastic sheeting

P1.20

P168.00

Explanation

Crack in the sheets. Do not replace.

Returned Via

Fedex

085

(Students Nam)
Purchasing Agent

Disbursement Voucher
DISBURSEMENT VOUCHER
Big Manufacturers
123 Molave Street
Fairview Ave., QC
Payee

Voucher No.
Issued Date
Due Date

0740
4/19/2008
5/27/2008

Small Products
54 West Avenue
Cebu City

Invoice Date

Terms

4/17/2008

2/10, n/30

Invoice No.
539
Less DM 085

Amount
P 11,778.00
168.00
P 11,610.00

Destribution
Account No.
121

5.

Amount
P11,610.00

Check No. BPI 000127

Approved By

A request for a purchase must be made by an authorized person.

A purchase order must be prepared and approved by an authorized person.
All materials must be checked to see that they correspond to the purchase order and are in
good condition.
Payment is made only after proper approval.
Various steps in the purchasing procedures are delegated to different persons to lessen the risk
of fraud or error.

7
Problem 2-2
2008
Oct. 24:

25:

Materials
Vouchers payable
To record voucher to Veterans Corp.
On invoice of October 21 for 4,800 units,
Of which 510 were returned.

92,235.00

Vouchers payable
Purchase discounts
Cash
To record payment of Voucher 014
Note: No journal entries are needed for the
Transactions on October 4, 5, and 21.

92,235.00

92,235.00

922.35
91,131.65

Problem 2-3

VOUCHER REGISTER

Date
March

Voucher
No.
031
032
033
034

Payable to
Lim Supply Company
Tan Corporation
Sy Company
Ong Company

For the Month of March, 2008

Paid
Date
Check. No.

Voucher
Payable
Cr 201

Materials
Dr. 121

P17,871.00
42,930.50
16,896.00
208,821.00
286,518.50

P17,871.00
42.930.50
16,896.00
208,821.00
286,518.50