LCCM - FINAL EXAMS – SUGGESTED SOLUTIONS

1. D
Total manufacturing cost = (P26,000 + 20,000 + 30,000) p 76,000

2. C
Toal goods put into process (P76,000 + P9,000) P 85,000

3. B
Cost of goods manufactured (P85,000 - P5,500) P 79,500

4. B
Cost of goods sold, normal (= COGM) P 79,500

5. C
Cost of goods sold, actual [P79,500 - P30,000 – P29,300)] P 78,800

6. C
Assigned or applied Factory Overhead is a cost element. It increases WIP when recognized
-
7. C
Total cost (P53,200 + P1,600 – P1,055) P 53,745
Divide by good units produced (200 -5) 195 P 275.62

8. A
Original unit cost (P53,200 / 200 units) P 266.00

9. B
Average method takes up all work done on iIP, beginning, while FIFO takes up only work done in
current period in computing for EUPs.

10. A
Materials purchased and processed P 843,750
Materials cost in RIP, beginning 39,375
Materials cost in RIP, end (41,250)
Material cost of completed units P 841,875

11. A
Material cost of completed units P 841,875
Material cost in FG, beginning 30,000
Material cost in FG, end (to balance) (26,250)
Material cost of sold units (given) P 845,625
 Conversion cost in FG, end (P39,375 – 26,250) P 13,125

12. A
Normal lost units (460,800 good output x 4%) 18,432 units
Abnormal lost units (22,600 units less 18,432 units) 4,168 units

13. A
FV of Marvin’s contribution (P28,310 – 240 + 2,200 +350 – 400) P 28,310
Ancho’s contribution (P28,310/.66667) x .33333 P 14,155

14. A
TAC CAN DIFF
C 118,200 120,000 (1,800)
D 98,800 100,000 (1,200)
A 93,000 90,000 3,000
Totals 31,000 310,000 0

15. A
Joint undertakings bound by contractual agreement for the sharing of control are called Joint
Arrangements under PFRS 11. The entity is a joint operation if the participants have rights over
assets and obligations over liabilities. It is a joint venture if the participants have rights over net
assets.

16. D
Cost at fair value (1,000,000 shares at P40) P 40,000,000
Net assets at fair value (P49,000,000 – P15,500,000) 33,500,000
Goodwill P 6,500,000

17. A
Retained earnings (P14,000,000 - P80,000) P 13,920,000

18. B
APIC (P1,000,000 + 8,000,000 – 12,000 - 3,000) P 8,985,000

19. A
Common stocks (P10,000,000 + P32,000,000) P 42,000,000

20. C
Janitorial cost allocated to Sales #1 (P30,000 x 30%) P 9,000

21. B
Peso sales (FC 300,000 x P1,145) P 343,500
22. C
Peso Contract payable (FC 300,000 x P1.125) P 337,500

23. B
Receivable from bank (FC 300,000 x P1.125) P 337,500

24. B
(FC 300,000 x (P1.145 – 1.125) P 6,000

25. B
A B C Total
BBL 15,000 7,000 3,000 P 25,000
Sonca-dol ( 1,000) (1,000) (1,000) (3,000)
Balances 14,000 6,000 2,000 22,000
TPL (P19,999( ( 6,334) (6,333) (6,333) (19,000)
Balances 7,666 ( 333) ( 4,333) 3,000
APL (4,666) 333 4,333 -
Free interest 3,000 0 0 3,000

26. A
Net income in Pesos (R500,000 x P.8250) P 412,500

27. A
PPE in pesos (R400,000 x P.8175) P 327,000

28. D
Cash (R1,200,000 x .8175) P 981,000
A/R (R1,900,000 x .8175) 1,553,250
MI (R700,000 x .8300) 581,000
PPE (R400,000 x .8125) 325,000
Total assets P 3,440,250

29. A
Choice b is used only for the required re-measurement at the intervening balance sheet date’
Choice c is not used in initial recognition of a foreign currency transaction;
Choice d is used only for the required re-measurement and settlement of the contract at expiry.
30. A
A B C Total
BBL P 32,000 P 52,000 P 38,400 P 122,400
Realization loss ( 12,800) ( 12,800) ( 6,400) ( 32,000)
Balances 19,200 39,200 32,000 P 90,400
TPL (P72,000) ( 28,800) ( 28,800) ( 14,400) ( 72,000)
Balances ( 9,600) 10,400 17,600 P 18,400
APL 9,600 ( 6,400) ( 3,200) -
Free interests P 0 P 4,000 P 14,400 P 18,400

31. C
Contribution of new partner (P300,000/80%) x 20% P 75,000

32. B
FV of original net assets (P40,000 / 25%) P 160,000
BCV of original net assets (given) 140,000
Gain from revaluation divided among the old partners in the P&L ratio P 20,000

K (P80,000 + P12,000) x 75% P 69,000

L (P40,000 + 6,000) x 75% 34,500

M (P20,000 + 2,000) x 75% 16,500

N (P160,000 ) x 25% 40,000
Total P 160,000

33. B
TBNI (P150,000 – 75,000 – 7,000 -30,000 – 15,000 + 9,570) P 32,570

34. A
Combined beginning inventory (P12,000 + P7,000) P 19,000

35. B
Combined ending inventory (P14,000 + P9,570) P 23,570

36. A
NCI amount at date of acquisition (P260,000/80%) x 20% P 65,000
37. A
Cost at FV of shares (P260,000 + P65,000 P 325,000
Book value (P100,000 + P150,000) (250,000)
BCVR ( 50,000)
Goodwill P 25,000

38. C
NCI amount at date of acquisition (P250,000 + P50,000) x 20% P 60,000

39. B
Cost at FV of INA (P250,000 + P60,000) P 320,000
Book value acquired ( 250,000)
BCVR ( 50,000)
Goodwill P 20,000

40. D P 7,000
Estimated cash available covers all prioritized claims, as follows:

Estimated total cash available P 167,000

Prioritize claims (P7,000 + P30,000 + P52,000) ( 89,000)
Estimate net cash available P 78,000
Unsecured amounts (P8,000 + P112,000) (120,000)
Estimated deficiency P(42,000)
ERR (P78,000 / P120,000) 65%

41. B
Always paid in full. P 30,000

42. B
Secured portion (P52,000 x 100%) P 52,000
Unsecured portion (P8,000 x 65%) 5,200
Total P 57,200

43. D
Unsecured without priority (P112,000 x 65%) P 72,800

44. A
Book value approach (P148,000 x 1/3) P 49,333

45. B
Book value method (P148,000 x 90%) x 1/3 P 44,400
46. A
Investment in JV, 12/31 (P1,250,000 + P57,500) P1,307,500

47. C
Retained earnings, 12/31 (P920,000 +P1,520,000 + 57,500) P2,497,500

48. C
SHE, 12/31 (P3,000,000 + P2,497,500) P5,497,500

49. D
Total Joint production cost P160,000
Divide by Total market value at split-off-point 200,000 80%

W (P80,000 x 80%) P 64,000

X (P60,000 x 80%) 48,000
Y (P40,000 x 80%) 32,000
Y (P20,000 x 80%) 16,000
Total joint production cost P 160,000

50. C
Product Units Unit SV Total SV APC NRV Joint Cost
AA 800 P25 P 20,000 P 8,000 P12,000 P 9,000
BB 400 50 20,000 12,000 8,000 6,000
1,200 P 40,000 P20,000 P20,000 P15,000