Problem 2

Marvin Manufacturing Company

Cost of Goods Sold Statement

For the year ended December 31,2019

Direct materials used

Materials, January 1 175,000

Purchases 250,000

Total available for use 425,000

Less: Materials, December 31 125,000  300,000

Direct Labor 270,000

Factory Overhead. 324,000

Total Manufacturing Costs 894,000

Work in process, January 90,000

Cost of goods put into process 984,000

Less: Work in process, December 31 120,000

Cost of goods manufactured 864,000

Finished goods, January 1 100,000

Total goods available for sale 964,000

Less: Finished goods, December 31 80,000

Cost of goods sold 884,000

Problem 3

Donna Company

Cost of Goods Sold Statement

For the month of May , 2019

Direct materials used

Materials, May 1. 124,000

Purchases 107,800

Total available. 231,800

Less: Material, May 31 115,000  116,800

Direct Labor 160,000

Factory overhead 240,000

Total manufacturing cost 516,800

Work in process, May 1 129,200

Cost of goods put into process 646,000

Less: Work in process, May 31 124,000

Cost of goods manufactured 522,000

Finished goods, May 1 150,000

Total goods available for sale 672,000

Less: Finished goods, May 31 122,000

Cost of goods sold 550,000

Problem 4

1. Journal Entries
a. Materials. 180,000
Accounts payable 180,000
b. Payroll 80,000
Withholding taxes payable 11,200
SSS Premiums payable 2,400
Phil Health contribution payable 375
Pag-ibig funds contribution payable. 1,620
Accrued payroll 64,405

Work in process 60,000

Factory overhead 20,000

Payroll 80,000

c. Materials 20,000
Accounts payable 20,000
d. Factory overhead 5,595
SSS Premiums payable 3,600
Phil Health contribution payable 375
Pag-ibig funds contribution payable. 1,620
e. Work in process. 120,000
Factory overhead 10,000
 Materials 130,000
f. Accounts payable 5,000
Materials 5,000
g. Accounts payable 148,300
Accrued payroll 64,405
Cash 212,705
h. Factory overhead 24,900
Miscellaneous accounts 24,900
i. Work in process 72,000
Factory OH applied ( 60,000 x 120%) 72,000
j. Finished goods 180,000
Work in process 180,000
k. Accounts receivable 210,000
Sales 210,000
Cost of goods sold 140,000
Finished goods 140,000

2.
Ram Company

Cost of goods sold statement

For the month of October, 2019

Direct materials used

Purchases 200,,000
Less: Purchase returns 5,000
Total available for use 195,000
Less: Ind. Mat. Used. 10,000
Mat.- October 31 65,000. 75,000 120,000
Direct labor 60,000
Factory overhead 72,000
Total manufacturing costs. 252,000
Less: Work in process, October 31. 72,000
Cost of goods manufactured 180,000
Less: Finished goods – October 31 40,000
Cost of goods sold, normal 140,000
Less: OA-FO 11,705
Cost of goods sold, actual 128,295

Actual factory overhead (FO Control ) 60,495

Less: Applied factory overhead. 72,000
Over applied factory overhead. (11,705)
 Problem 5

1. Journal Entries
a. Materials 200,000
Accounts payable 200,000
b. Factory overhead 35,000
Accounts payable 35,000
c. Payroll 210,000
Withholding taxes payable 18,520
SSS Premiums payable 8,400
Phil Health contribution payable 1,125
Pag-ibig funds contribution payable. 6,300
Accrued payroll 175,655

Work in process 140,000

Factory overhead 30,000
Selling expense 25,000
Administrative expense 15,000
Payroll 210,000
d. Accrued payroll 175,000
Cash 175,000
e. Factory overhead 14,200
Selling expense 2,375
Administrative expense 1,350
SSS Premiums payable 10,500
Phil Health contribution payable 1,125
Pag-ibig funds contribution payable. 6,300
f. Work in process 185,000
Factory overhead 35,000
Materials 220,000
g. Work in process. 112,000
FO Applied (140,000 x 80%) 112,000
h. Finished goods 410,000
Work in process 410,000
i. Accounts receivable 539,000
Sales 539,000
Cost of goods sold 385,000
Finished goods 385,000
j. Cash 405,000
 Accounts receivable 405,000
k. Accounts payable 220,000
Cash 220,000

2. Cost of goods sold statement

Direct materials used
Materials, January 1 50,000
Purchases 200,000
Total available 250,000
Less: Materials, January 31. 30,000
Indirect Materials 35,000  185,000
Direct labor 140,000
Factory overhead 112,000
Total manufacturing costs 437,000
Work in process , January 1 18,000
Cost of goods put into process 455,000
Less: Work in process, January 31 45,000
Cost of goods manufactured 410,000
Finished goods, January 1 35,000
Total goods available for sale 445,000
Less: Finished goods, January 31. 60,000
Cost of goods sold, normal 385,000
Under applied factory overhead 2,200
Cost of goods sold, Actual 387,200

3. Income statement
Sales 539,000
Less: Cost of goods sold 387,200
Gross profit 151,800
Less: Operating expense
Selling 27,375
Administrative 16,350  43,725
Net income 108,075
4. Financial statement
Cash 110,000
Accounts receivable 194,000
Finished goods. 60,000
Work in process. 45,000
Materials 30,000
Accounts payable 25,000
Accrued payroll. 8,655
W/tax. 18,520
SSS Prem. payable 18,900
 Phil health Cont. payable 2,250
PFC payable 12,600
Common Stock 200,000
Retained earnings 153,075
Total 439,000 439,000

Problem 6

1. Cost of goods manufactured 800,000

Work in process, December 31 87,000
Cost of goods put into process 887,000
Total manufacturing costs (790,000)
Work in process, January 1 97,000

2. Cost of goods manufactured 800,000

Finished goods, January 1 80,000
Total goods available for sale 880,000
Cost of goods sold (750,000)
Finished goods, December 31 130,000

3. Direct materials used 590,000

Materials, December 31 150,000
Total available for sale 740,000
Materials, January 1 (100,000)
Materials purchased 640,000

Problem 7

1. The company is using job order costing because it is a manufacturing

unique and custom made furniture.
2. Manufacturing is allocated based on the direct labor cost incurred
Factory overhead rate – 24,000,000/20,000,000 = 120% of direct labor cost
3. Actual factory overhead ( 500,000 + 750,000 + 1,000,000 + 11,000,000 + 2,000,000) 22,000,000
Applied (20,000,000 x 120%) 24,000,000
Over applied overhead 2,000,000
4. Direct materials used 30,000,000
Direct labor 20,000,000
Factory overhead applied 24,000,000
Total manufacturing cost 74,000,000
Work in process, January 1 5,000,000
Work in process, December 31 (4,000,000)
Cost of goods manufactured 75,000,000
Finished goods, January 1 13,000,000
Finished goods, December 31 (11,000,000)
Cost of goods sold, normal 77,000,000