1. KM Co.’s manufacturing overhead is 20% its total conversion costs.

If direct labor is P38,000 and

if direct materials are P35,000, the manufacturing overhead is:

2. If direct labor is 60% of prime cost and direct labor cost and manufacturing costs totaled
P17,000 and P82,000 respectively, the overhead is:

3. In January, direct labor was 40% of conversion cost. If the manufacturing overhead was P78,000
and direct materials was P22,000, direct labor is:

4. The following information is taken from the records of KAPM Company for last year:

Direct Materials P5,000

Manufacturing overhead 6,000
Total manufacturing costs 17,000
Work in process – beg 1,000
Cost of goods manufactured 15,000

How much is direct labor and ending work in process inventory, respectively?

5. Data taken from the books of KPM Inc. for the year ended Dec. 31, 2010 are as follows:
Increase in raw materials P15,000
Decrease in finished goods 35,000
Freight-out 45,000
Raw materials purchased 430,000
Direct labor payroll 200,000
Factory overhead 300,000

There was no work in process inventory at the beginning of the year. The cost of goods sold for
the year must be:
6. KM Company has provided the following data for the month of November:

Inventories Nov-01 Nov-30

Raw materials 17,000 ?
Work in process 14,000 12,000
Finished goods ? 9,000

Additional Data:
Sales revenue 102,000
Direct labor costs 10,000
Manufacturing overhead 12,000
Selling expenses 14,000
Administrative expenses 16,000
Cost of goods manufactured 40,000
Raw materials purchases 10,000

A. The ending raw materials inventory was:

B. If the operating income was P40,000, then the beginning finished goods inventory was:

7. For the last 2 months, K.M. Corporation shipped 8,000 tons and 10,000 tons of coal and incurred
P400,000 and P499,000 in shipping costs respectively. Assuming this activity is within the
relevant range, expected shipping costs for 11,000 tons would be:

8. KE MA Trading is a wholesaler of a special pet. Management has provided the following cost
data for two levels of monthly sales volume. The company sells the product for P104.5/unit.

Sales volume (units) 5,000 6,000

Cost of sales P295,000 P354,000
Selling, general & admin P186,000 P202,800

Best estimate of total monthly fixed cost is:

9. KAPM Corporation provided the following production and average cost data for two levels of
monthly production volume. The company produces a single product.

Production volume (units) 4,000 5,000

Direct materials/unit P85.80 P85.80
Direct labor/unit P56.10 P56.10
Manufacturing overhead/unit P73.6 P62.10

The best estimate of the total cost to manufacture 4,300 units is closest to:
10. K Inc., a major supplier of books in the different colleges, presented the ff. data:

Sales 800,000
Cost of Sales 560,000
Gross Profit 240,000
Selling Expenses 105,000
Administrative Expenses 105,000
Operating Income 30,000

On the average, a book sells for P40. Variable selling expenses are P3 per book while variable
administrative expenses equal to 5% of sales. The cost formula for operating expenses with “x”
equal to the number of books sold is