Problem 1:

On January 1, the general ledger of Jocelyn Company contained the following accounts and
balances:

Cash P 94,000
Accounts Receivable 100,000
Finished Goods 65,000
Work in Process 15,000
Materials 44,000
Machinery 90,600
Accumulated Depreciation – Machinery 20,000
Accounts Payable 118,750
Common Stock 200,000
Retained Earnings 69,850

Details of inventories are:

Finished Goods Inventory: P 65,000

Job 101 Job 102

Work in Process Inventory:
Direct materials: 1,000 units of A @ P5 5,000
400 units of B @ P3 1,200
Direct Labor: 1,000 hours @ P4 4,000
400 hours @ P5 2,000
Manufacturing overhead applied at the rate of P2 per direct labor 2,000 800
hour
Total P 11,000 P 4,000

Materials Inventory: P 44,000

During January, the following transactions were completed:

(a) Materials were purchased on account for P229,040.
(b) Payroll totaling P220,000 was accrued.
(c) Payroll was distributed as follows: Jobs 101, 5,000 direct labor hours @ P8; Job 102, 8,000
direct labor hours @ P10; Job 103, 6,000 direct labor hours @ P6. Indirect labor, P24,000
and selling and administrative expense, P40,000.
(d) Materials were issued as follows: P103,200 to Job 101; P84,000 to Job 102; P29,150 to Job
103. Indirect materials costing P15,040 were issued.
(e) Manufacturing overhead was applied to Job 101, 102, and 103 at a rate of P4.50 per direct
labor hour.
(f) Jobs 101 and 102 were completed and immediately sold on account for P250,000 and
P270,000, respectively.
(g) The accounts receivable from sales of Jobs 101 and 102 was collected and allowed a 5%
cash discount.
(h) Marketing and administrative expenses (other than salaries) paid during the month
amounted to P30,000. Other manufacturing overhead paid, P49,720.
(i) Payments on account, other than payrolls, amounted to P170,000.
(j) Applied manufacturing overhead is closed to manufacturing overhead control. Any
under-applied or over-applied overhead is considered material.

Required:
(1) Journalize the January transactions.
(2) Prepare a cost of goods sold schedule for January.

Problem 2:
Sweet Company uses normal costing in its job costing system. Partially completed T-account
and additional information for the year 2023 are as follows:
Materials
 1/1: 380,000 Work in Process
30,000 1/1: 20,000
400,000 DL 360,000

Finished Goods
1/1: 900,000 Manufacturing Overhead Control
10,000 540,000
940,000

Additional information:
(a) Direct labor cost rate was P15 per hour.
(b) Manufacturing overhead was applied at P20 per direct labor hour.
(c) During the year, sales revenues were P1,090,000 and marketing expenses were P140,000.

Required:
(1) What was the amount of direct materials issued to production during 2023?
(2) What was the amount of manufacturing overhead applied to jobs during 2023?
(3) What was the cost of jobs completed during 2023?
(4) What was the balance of work in process inventory on December 31, 2023?
(5) What was the cost of goods sold before adjustment for over- or under-applied overhead?
(6) What was the over- or under-applied overhead in 2023?
(7) What is the operating income (loss) for 2023 assuming the over- or under-applied is
considered immaterial?
(8) What is the operating income (loss) for 2023 assuming the over- or under-applied is
considered material?