12. 1B. (b) Solve upward from Cost of Goods Sold. Raw materials inventory, Jan. 1 Gross purchases (squeeze) Freight in Raw materials available for use Raw materials inventory, Dec. 31 Raw materials used Direct labor Factory overhead: Indirect labor P12,160 Factory overhead expenses 31,730 Indirect materials 21.370 Manufacturing cost Work in process inventory, Jan. 1 Total Work in process inventory, Dec. 31 Cost of goods manufactured (16,000 units) Finished goods inventory, Jan. 1 (500 units x P12*) Goods available for sale Finished goods inventory, Dec. 31 (1,500 units x P12) Cost of goods sold (15,000 units x P12) * 192,000 / 16,000 units = P12 Sales Cost of goods sold Gross profit (@) ‘Materials inventory, beginning Purchases ‘Materials available for use Materials inventory, ending Materials used Direct labor (P15,000 + 2/3) Factory overhead Factory cost Work in process inventory, beginning Total Work in process inventory, ending Cost of goods manufactured Finished goods inventory, beginning Goods available for sale Finished goods inventory, ending Cost of goods sold Sales Cost of goods sold Gross profit Operating expenses ( P72,000 x 6%) Operating income Other expenses (P72,000 x 5%) Net income before income tax P 11,600 88,610 5.570 105,800 9.640 96,160 32,640 65.280 194,080 3140 199,820 1320 192,000 6,000 198,000 18.000 Pisi000 360,000 180,000 180,000 P 8,000 36,000 44,000 35,500 22,500 73,000 81,000 66,000 73,000 4.880w Cost of goods sold Finished goods inventory, Dec 31 Goods available for sale Sales Cost of goods sold Gross profit Operating expenses: Marketing expenses P14,000 General and administrative expenses 22.900 Operating income (d) Factory overhead: Indirect labor Factory heat, light and power Factory rent Factory insurance Production supervisor's salary Indirect materials used (P5,600+P16,500- P5180) Overtime pay [250 hours x (P22 x .5)] Total Direct materials inventory, March 1 Purchases Ayailable for use Direct materials inventory, March 31 Direct materials used Direct labor (4,250 hours x P22) Factory overhead (1) Factory cost Work in process inventory, March 1 Total Work in process inventory, March 31 Cost of goods manufactured Finished goods inventory, March 1 Goods available for sale Finished goods inventory, March 31 (Squeeze) Cost of goods sold (given) P111,000 12,500 B128,500 P182,000 111,000 71,000 — 36,900 PABLO P 22,000 11,220 18,500 2,000 5,000 16,920 2.750 278.390 P 10,250 105.000 115,250. 12,100 102,550 93,500 —18.390 274,440 00,420 334,860 52.800 282,060 45602 327,662 47,662 -P280,000«@) Materials, inventory, beginning Purchases (Squeeze) Available for use Materials inventory, ending Raw materials used Direct labor [(P686,000-P326,000) + 160 %] Factory averhead (P225,000 x 60%) Manufacturing cost Work in process inventory, beginning Total ‘Work in process inventory, ending ‘Cost of goods manufactured tc) Materials inventory, July 1 Purchases Freight in Available for use Materials inventory, July 31 Direct materials used Direct labor Factory overhead [P468,400+ (P116,000 x 90%)] Manufacturing eost Work in process inventory, July 1 Total Work in process inventory, July 31 Cost of goods manufuetured Finished goods inventory, July L Goods available for sale Finished goods inventory, July 31 ‘Cost of goods sold tb) Direct materials: Matcrials inventory, Dec 1 P24,000 Purchases 56,000 Materials inventory, Dee 31 (20.000 Direct labor Prime cost Direct labor Factory overhead [(P-40,000 + P6.40) x P&} ‘Conversion cost P 75,000 336,000 411,000 85,000 326,000 225,000 135,000 686,000 20.000 766,000 30.000 B736,000 P 88,000 366,000 —6.000 460,000 —64,000 396,000 523,000 372.800 1,489,800 19,800 1,521,600 3 1,482,800 — 44.200 1,327,000 —86,000 PLAo L000 P 60,000 — 40.000 100,000 P 40,000 50.000 90.00019. 20. 2. @ 1. Direct materials inventory, end (P100,000 — P70,000) 30.000 2. Work in process contral, end (P320,000 — P305,000) PLs.000 3 ished goods control, end, (P325,000— P300,000) P25.000 () ct materials, Dec. 31, 2008 (Squeeze) P 30,000 Purchases 90.000 Available for use 120,000 Direct materials, Dee 199 20.000 Direct materials used (given) 100,000 Direct labor (P72,000 = 200%) 36,000 Applied factory overhead 72.000 Manufacturing cost 208,000 Work in process inventory, Dec. 31, 2008 (Squeeze) 3,000 Total 211,000 Work in process inventory, Dec. 31, 19x9 35.000 Cost of goods manufactured 176,000 Finished goods inventory, Dec. 31, 19x8 50,000 Goods available for sale 226,000 Finished goods inventory, Dec. 31, 19x9 — 46,000 Cost of goods sold (given) ‘biso.000 fa) Materials inventory, Jah. 1 P 34.200 Purchases (P364,000 + P8,600 —P5.200) 367.400 Available for use 401,600 Materials inventory, Dec. 31 49.300 Direct materials used 352,300 Direct labor 162,500 Factory overhead (P21,330 + P83,400 + P47,900) 152.650 ‘Manufacturing cost 667.450 Work in process inventory, Jan 1 -BL500 Total 748,950 Work in process inventory, Dec. 31 42.350 Cost of goods manufactured (4,000 units) 706,600 Finished goods inventory, Jan 1 (300 units) 48.600 Goods available for sale (4,300 units) 755.200 Finished goods inventory, Dee. 31 [420 units x (P706,600 + 4,000 units)] _74.193 Cost of goods sold P2gL.007 (1) P74,193/420 units = R176.65 (2) Sales (3,880 units x P220) P853,600 Cost of gods sald 281.007 Gross profit PL72,593,22. 23. w Materials used P 440,000 Direct labor 290,000 Applied factory overhead (P290,000 x 39%) 87.000 Factory cost 817,000 Work in process inventory, April 1, 19x7 41.200 Total 858,200 Work in process inventory, April 1, 19x8 42,500 Cost of goods manufactured B8LS.70 Unit cost (P815,700 + 18,000 nits) P_45,.32 Applied factory overhead P 87,000 Actual factory overhead Indirect labor 46,000 Light and power 4,260 Depreciation 4,700 Repairs 5,800 Miscellaneous 29,000 89.760 Under-applied factory overhead B.2.760) () Applied factory overhead (P70,000 + P112,000) P182,000 Actual factory overhead 180,000 factory overhead P2000 Sales: Product X (9,000 x P30) P270,000 Product ¥ (8,800 x P50) 440,000 P710,000 Cost of goods sold (Sch. 1) 512,600 Gross profit 197,400 Operating expenses 100,900 Operating income 296,500 Sch. 1: Manufacturing cost (P210,000 + P296,000) P506,000 Beginning inventories (P21,000 + P33,300) 34.300 Total 560,300 Ending inventories (P42,000 + P3,700) 45,700 Cost of goods sold at normal 514,600 Over-applied factory overhead (2.000) Cost of goods sold at actual B512.600(a) Direct labor (8,000 hrs, x P5.60) + (4,600 hrs, x P6.00) Factory overhead (8,000 hhrs. x P6.00) + (4,600 hrs x P8.00) Conversion cost Materials inventory, beginning Purchases Available for sale ‘Materials inventory, ending Direct materials used Conversion cost Factory cost Work in process inventory, beginning Total ‘Work in process inventory, ending Cost of goods manufactured Finished goods inventory, beginning Goods available for sale Finished goods inventory, ending Cost of goods sold ©) Materials inventory, April 1, 198, Purchases Available for use Materials inventory, June 30, 19x8 Direct materials used Direct labor Factory overhead Factory cost Finished goods inventory, April 1, 19x8 Goods available for sale Finished goods inventory, June 30, 19x8 (200 x P395) Cost of goods sold Unit cost of equipment manufactured (P4,937, 500 + 12,500 units) Sales Cost of goods sold Gross profit Per unit (P755,500 ~ 12,400) Gross profit Operating expenses Net income Per unit (P755, 500 = 12,400) 72,400 -34,800. PLS7Z200 P20,000 f.000 80,000 18.000 62.000 AS72200 219,200 415,000 234,200, 17.000 216,600 22.000 238,600 12.000 P221,600 P 268,000 1946.70 2.214.200 167.900 2,047,700 2,125,800 —164,000 4,937,500 —43.000 4,980,500 —79.000 P4901. 500 395,00 P 6,634,000 4,901,500 Hist ELM P 1,732,500 —277.000 bus 260.93