4.

Basilio Company has a cycle time of 3 days, uses a Materials and In Process (MIP) account, and
charges
all conversion costs to Cost of Good Sold. At the end of each month, all inventories are counted, their
conversion costs components are estimated, and inventory account balances are adjusted. Raw
material
cost is backflushed from MIP to Finished Goods. The following information is for June:

Beginning balance MIP account, including P 3,000 of conversion costs P 29,250

Beginning balance of finished goods account, including P 10,000 of conversion P 30,000
costs
Raw materials received on credit 562,500
Direct labor cost, P 375,000; Factory overhead applied, P 450,000 825,000
Ending MIP inventory per physical count, including P 4,500 of conversion costs 32,000
Ending finished goods inventory per physical count, including P 8,750 of conversion 26,250
costs

What is the conversion costs of units sold in June?

a. P 825,250 b) P 825,000 c) P 840,000 d) P 824,750

The Magnolia Corporation has a cycle time of 1.5 days, uses a raw and in-process account, and
charges
all conversion costs to Cost of Goods Sold. At the end of each month, all inventories are counted,
their
conversion cost components are estimated, and inventory account balances are adjusted. Raw
materials
cost is backflushed from raw materials and in-process account to finished goods. The following
following information is for July.

Beginning balance of Raw and in-process account, including P 14,040 of conversion cost P
23,400
Beginning balance of finished goods account, including P 14,400 of conversion cost…… .…
24,000
Raw materials received on credit ……………………………………………………………………. .
444,000
Ending Raw and in-process inventory per physical count, including P 15,360
conversion cost estimate ……………………………………………………………………….….
25,600
Ending Finished goods inventory per physical count, including P 11,400
conversion cost estimate………………………………………………………………………….
19,000
Conversion cost ( direct labor – P 210,000; factory overhead – P 189,000)

REQUIRED: Prepare journal entries to record the given transactions.

7. The balance of the cost of goods sold after adjustment is _______________________