PECASALES, NINA SHRINE A.

P2-1 A.
Orange company showed the following information as of June 1, 2015: Raw materials inventory
Raw materials inventory ₱320,000 Beg. 320,000 200,000 Materials used
Goods in process inventory 400,000 Purchases 170,000
Finished goods inventory 350,000
490,000 200,000
During the month of June, the following were incurred: 200,000
Materials purchased ₱170,000 Ending Bal. 290,000
Materials used 200,000
Direct labor 400,000
Factory overhead 210,000
Direct Materials Used 200,000
After reviewing the qiantities on hand, ending inventories were: Direct labor 400,000
Goods in process inventory ₱280,000 Factory overhead 210,000
Finished goods 430,000 Total Manufacturing cost: 810,000
Add: WIP, Beg 400,000
Required: Calculate the following: Less: WIP, Ending 280,000
a. Raw materials inventory as of June 30, 2015 B. Cost of goods manufactured 930,000
b. Total goods manufactured during the month Add: Finished goods, Beg. 350,000
c. Goods available for sale Less: Finished goods, Ending 430,000
d. Cost of goods sold D. Cost of goods sold 850,000

C. Cost of goods manufactured 930,000

Add: Finished goods, Beg. 350,000
Goods available for sale 1,280,000
PECASALES, NINA SHRINE A.
P2-2
Red company has the following cost date as of September 1, 2015
Materials purchased ₱170,000
Materials used 200,000
Direct labor 400,000
Factory overhead 210,000
Office rent 50,000

Required: Calculate the following:

a. Total manufacturing costs
b. Total prime costs
c. Total conversion costs

A.
Materials used 200,000
Direct labor 400,000
Factory overhead 210,000
Total Manufacturing cost: 810,000

B.
Materials used 200,000
Direct labor 400,000
Total prime costs: 600,000

C.
Direct labor 400,000
Factory overhead 210,000
Total conversion costs 610,000
PECASALES, NINA SHRINE A.
P2-3
Pink Company provided the following information as of May 31, 2015:
Sales 900,000
Finished goods inventory, May 31 300,000
Goods in process inventory, May 31 350,000
Raw materials inventory, May 31 280,000
Finished goods inventory, May 1 200,000
Goods in process inventory, May 1 310,000
Raw materials inventory, May 1 250,000
Direct labor 150,000
Factory overhead 110,000
The average historical gross margin is 30% of sales.

Required: Calculate the following:

a. Total manufacturing costs
b. Total raw materials used
c. Total raw materials purchased

A.
Sales 900,000
Cost of goods sold
Finished goods inventory, May 1 200,000
Add: Cost of goods manufactured 730,000
Total goods available for sale 930,000
Less: Finished goods inventory, May 31 300,000 630,000 (900,000 - 270,000)
Gross Margin 270,000 (900,000 x 30%)

B. Direct Materials Used 510,000

Direct labor 150,000
Factory overhead 110,000
A. Total Manufacturing cost: 770,000
Add: WIP, Beg 310,000
Less: WIP, Ending 350,000
Cost of goods manufactured 730,000
Add: Finished goods, Beg. 200,000
Less: Finished goods, Ending 300,000
Cost of goods sold 630,000

Raw materials inventory

Beg. 250,000 510,000 Used B.
C. Purchase 540,000

End. 280,000

Work in process inventory

Beg. 310,000 730,000 COGM
DM used 510,000
DL 150,000
overheads 110,000
End. 350,000

Finished goods inventory

Beg. 200,000 630,000 COGS
COGM 730,000

End. 300,000
PECASALES, NINA SHRINE A.
P2-4
The following data are available for White Company during the month of July 2015:
Direct materials purchased ₱ 95,000
Direct labor 80,000
Indirect materials 40,000
Indirect labor 45,000
Other indirect factory costs 60,000
Marketing expenses 72,000
Other salaries and wages 30,000
Raw materials inventory, June 30 35,000
Raw materials inventory, July 31 50,000

Required: Calculate the following:

a. Total manufacturing costs
b. Total factory overhead

Raw materials inventory

Beg. 35,000 80,000 M. used
M. purchased 95,000

50,000

factory overhead
Indirect materials 40,000
Indirect labor 45,000
Other indirect factory costs 60,000
B. Total Factory overhead 145,000

A.
Raw materials, Beg 35,000
Add: RM Purchases 95,000
RM Available for use 130,000
Less: Raw Materials, End 50,000
Materials used 80,000
Less: Indirect Materials 40,000
Direct Materials 40,000
Direct labor 80,000
Factory overhead 145,000
Total Manufacturing cost: 265,000
P2-8
Uniformata company received an order to make school uniforms and uses the job
order costing system. Required: Journal entries to record the transactions.
DEBIT CREDIT
The ff. transaction occurred during 2014 relating to Job-U-101: 1 Raw materials ₱2,000,000.00
1. Purchased raw materials at a cost of P2,000,000 Cash ₱2,000,000.00
2. Direct materials used for P1,400,000
3. Raw materials were used as indirect materials, P200,000 2 Work in process ₱1,400,000.00
4. Direct labor hours consumed P1,500,000 on the job, which was fully paid. Raw materials ₱1,400,000.00
5. Indirect labor hours used costing P500,000
6. Other indirect costs accrued were P1,250,000 3 Manufacturing overhead control ₱200,000.00
7. Manufacturing overhead equal to 100% of direct labor was charged. Raw materials ₱200,000.00
8. The cost of U-101 of P4,400,000 (direct materials of P1,400,000 + direct labor cost
of P1,500,000 + applied overhead of P1,500,000) was transferred to finished goods 4 work in process inventory ₱1,500,000.00
on completion Cash ₱1,500,000.00
9. Revenue ia recorded at P5,720,000 (P4,400,000 x 130%)
10. Actual manufacturing overheads were P1,950,000 (indirect materials costing 5 Manufacturing overhead control ₱500,000.00
P200,000 + indirect labor costing P500,000 and other overheads of P1,250,000). Wages and salaries payable ₱500,000.00
Applied manufacturing overheads were P1,500,000. The manufacturing overheads
worth P450,000 were underapplied and are taken to the cost of goods sold or 6 Manufacturing overhead control ₱1,250,000.00
income statement. Accrued expenses ₱1,250,000.00

7 Manufacturing overhead control ₱1,500,000.00

Accounts payable ₱1,500,000.00

8 Finished goods inventory ₱4,400,000.00

Work in process inventory ₱4,400,000.00

9 Accounts receivable ₱5,720,000.00

Sales ₱5,720,000.00
Cost of goods sold ₱4,400,000.00
Finished goods inventory ₱4,400,000.00

10 Applied Manufacturing overhead ₱1,500,000.00

Cost of goods sold ₱450,000.00
Manufacturing overhead control ₱1,950,000.00
₱24,820,000.00 ₱24,820,000.00
P2-9
Splenda & Co provided the following information for July 1, 2015: A.
Estimated manufacturing overhead ₱562,500 Estimated manufacturing overhead
Predetermined overhead rate=
Actual manufacturing overhead ₱540,000 Estimated direct labor cost
Estimated direct labor cost ₱450,000 562,500
=
Actual direct labor cost ₱470,000 450,000
Total work in progress account (debit) ₱1,680,000
=
Total work in progress account (credit) ₱1,000,000 1.25 per hour

Actual manufacturing overhead ₱540,000

Splenda uses normal cost system and manufacturing overhead are being applied Applied overhead (P470,000 x 1.25) ₱587,500
to jobs on the basis of direct labor cost. A markup of 50% is also added to the cost B. OVERAPPLIED= ₱47,500
of production at time of sale of finished goods. On July 31st, Job 99 remained in
production with direct materials and direct labor charges of P15,000 and P35,000,
respectively. Work in process inventory
Beg. - 1,000,000 COGM

Required: C. ( 1,680,000 - 587,500 - 470,000) DM used 622,500

a. Calculate predetermined overhead rate. Actual DL cost 470,000
b. Determine under/overhead applied rate amount. Applied overhead 587,500
c. Calculate direct material used in production Debit Bal. 1,680,000 1,000,000 Credit Bal.
d. COmpute ending work in process inventory 1,000,000
e. Journal entry to record sales assuming all credit sales D. Ending Bal. 680,000

E. DEBIT CREDIT
Jun-15 Accounts receivable ₱1,500,000.00
Sales ₱1,500,000.00
Cost of goods sold 1,000,000
Finished goods inventory 1,000,000

Jul-15 Accounts receivable 879,375

Sales 879,375
Cost of goods sold 586,250
Finished goods inventory 586,250
P2-10
Volka Food & Co makes customized products inluding drinks and had three (3) drinks production orders at the
end of June 2015: Orange drink, Cola Drink, and soda water. Material costs for Orange drink and Soda water
were P400 and P200. Direct labor costs per batch were P150 and P350 for Orange Drink and COla Drink,
respectively and P550 in total. Overhead is applied at the rate of 40% of direct materials costs. Total costs foor
the Cola Drink batch P950.

Required: Calculate the balance of work in process at the end of June 2015

Direc labor cost Overhead applie

Drinks Material costs Total cost
(per batch) (40% of DM cost)

Orange drink ₱400 ₱150 ₱160 ₱710

Cola drink ₱429 ₱350 ₱171 ₱950
Soda water ₱200 ₱50 ₱80 ₱330
₱550

WORK IN PROCESS INVENTORY

Orange drink Cola drink Soda water Total
WIP, Beg - - - -
Materials ₱400 ₱429 ₱200 ₱1,029
Direct labor ₱150 ₱350 ₱50 ₱550
overhead ₱160 ₱171 ₱80 ₱411
₱710 ₱950 ₱330 ₱1,990
Less: Completed 0 0 0 0
WIP, End ₱710 ₱950 ₱330 ₱1,990
P2-11

Copenhagen COmpany uses a ob order cost system. Factory overhead is applied to job using a predetermined rate based on direct labor
hours. At the beginning of the year, the estimated factory overhead and direct labor hours were P480,000 and P12,000 hours
respectively. During the year, Copenhagen incurred total actual factory overhead of P475,000 and P11,500 direct labor hours. Among the
job orders received during the year, Job #902 comprising of 100 units of finished products was completed with total materials cost of
P5,000 and direct labor cost of P12,300 at P41 per hour.

Required:
a. Calculate the predetermined overhead rate.
b. Calculate the total amount of overhead charged to all jobs during the year.
c. Calculate the amount of under/ overapplied overhead of the year.
d. Calculate the unit cost of Job #902.

A.
Estimated manufacturing overhead
Predetermined overhead rate=
Estimated direct labor cost
480,000
=
12,000
=
P40 per hour

Applied overhead (P11,500 x P40) ₱460,000

B. = ₱460,000

Actual manufacturing overhead ₱475,000

Applied overhead (P11,500 x P40) ₱460,000
C. UNDERAPPLIED= (₱15,000)

Calculate the unit cost of Job #902.

Direct materials 5,000
Direct labor 12,300
Overhead (300 x P40) 12,000
DLH (12,300* 41)
Total manufacturing cost 29,300
Divide:Units of finished product 100
D. Unit cost of job #902 ₱293