Problem 1-18 job order costing system/normal cost system/perpetual inventory method

a. no entry

b. Materials 720,000
accounts payable 720,000

c. Work in process 560,000 direc mat.

Factory overhead, control 40,000 indirect mat.
Materials 600,000

d factory payroll 680,000 Gross pay

withholding tax payable 34,000
sss contribution payabe 7,500
Philhealth cont. payl 2,400
pag-ibig contributions 2,000
salaries and wages payable 634,100 net pay
(reccord payroll)

salaries and wages payable 634,100

cash 634,100
(payment)

work in process 620,000 direct labor

factory overhead, control 60,000 indirect labor
factory payroll 680,000
(charge labor cost to production or allocate payroll)

e. factory overhead, control 14,600

sss contribution payabe 10,200
Philhealth cont. payl 2,400
pag-ibig contributions 2,000

f factory overhead, control 60,000

accumulated depreciation-fac. Equipt 60,000

g factory overhead, control 340,000

various accounts 340,000 cash, accounts payable, prepaid rent etc.

h. work in process 620,000

factory overhead control 620,000 applied overhead
OH rate = 100% of direct labor cost

or

work in process 620,000

factory overhead, applied 620,000

i Finished goods 1,200,000 job 40 & job 41

 Work in process 1,200,000

JO 40 JO 41 JO 42
wip beg. Cost 20,000 60,000
current cost:
DM 100,000 220,000 240,000
DL 200,000 200,000 220,000
FO, applied 200,000 200,000 220,000
total cost 520,000 680,000 680,000
completed and completed and
sold unsold WIP end

j accounts receivable 900,000

sales 900,000

cost of sales 520,000 job 40

finished goods 520,000
 factory overhead control
actual OH cost h. applied 620,000
c 40,000
d 60,000
e 14,600
f 60,000
g 340,000
514,600 620,000
bal. 105,400 overapplied OH
amount of FO variance is insignificant:
factory overhead, control 105,400
cost of sales 105,400

decrease in COGS = increase net income

Work in process
beg. 80000 i. to FG 1,200,000
c. DM 560,000
d. DL 620,000
h. FO 620,000
end 680,000
PROBLEM 1-18

a materials 136,000
accounts payable or cash 136,000

b factory payroll 180,000

payroll payable 180,000

c manufacturing overhead, control 158,500

accounts payable or cash 98,500
accumulated depreciation 60,000

d Work In Process 105,500

manufacturing overhead, control 15,500
materials 121,000

e Work In Process 156,000

manufacturing overhead, control 24,000
factory payroll 180,000

f work in process 195,000 or work in process

manufacturing overhead, control 195,000 Manufacturing Overhead, applie
(total DLH x P10 per DLH)

810 809 811 812 813

beg. Cost 28,800 11,500 13,900
current cost:
Dm 14,000 24,000 34,000 33,500
DL 64,000 32,000 36,000 24,000
OH Applied 80,000 40,000 45,000 30,000
28,800 169,500 109,900 115,000 87,500
FG beg. finished and sold finished & uns WIP end
FG end

g. finished goods 394,400

work in process 394,400 cost of goods manufactured
( Job 809, 811, 812)

h Accounts receivable 412,500

sales 412,500

cost of sales 308,200

finished goods 308,200
(jo 809, 810, & 811)
i operating expense 74,500
cash 74,500

i no entry (entry is deferred until the end of the year)

4 Materials Work in Process

beg. 45500 d. 121,000 beg. 25,400 g 394,400
a. 136000 d. 105,500
end 60,500 e. 156000
f 195,000
end 87,500

Direct materials used

2 Materials beg. 45500
add: purchases 136000
total cost of materials available for use 181500
less: materials end 60,500
total cost of materials used in production 121,000
Less: indirect materials used 15500
direct materials used 105,500
Direct labor 156,000
Factory overhead, applied 195,000
total manufacturing cost 456,500
add: WIP beg. 25,400
total cost of goods placed in process 481,900
less: WIP end 87,500
cost of goods manufactured 394,400

3 Sales 412,500
Less: cost of sales
FG beg job 810 28800
Add: cost of goods manufactured 394,400
total cost of goods available for sale 423200
Less: FG end (job 812) 115,000
cost of sales (job 809, 810, 811) 308,200
Gross profit 104,300
Less: operating expense 74,500
net income 29,800

note: cost of sales must be adjusted at the end of the period for the overapplied or underapplied overhead
ork in process 195,000
Manufacturing Overhead, applied 195,000

total

105,500
156,000
195,000 P10 x dlh

s manufactured
 Finished Goods
beg. 28800 h. 308,200
g. 394,400
end 115,000

job. 813
job. 809, 811, 812

pplied or underapplied overhead

PROBLEM 1-13

direct materials control Accounts payable

5/1 bal 16,000 payment 78,000
purchases 80,000 dm issued 76,000

5/31 bal 20,000

WIP control FO control

5/1 bal 2,000 mfd 147,000
dm 76,000 total charges 55,000
DL 23,500 bal 5,000
Ohapplied 50,000 underapplied
5/31 BAL 4,500

FG control cost of goods sold

5/1 bal 25,000 sold 165,000 sold 165,000
cost of
goods mfd 147,000

5/31 bal 7,000

a Predetermined OH rate = budgeted Oh 750,000.00 =

budgeted activity 15,000.00 mh

WIP end
dm 2,000
dl P25 per dlh 1,000 DL rate 1000/40 25
oh applied 1,500 30 x P50
4,500 DL cost in May 940 x 25
OH applied in May 1000mh x 50
answers:
1 80,000
2 147,000
3 50,000
4 4,500
5 76,000
6 16,000 disposition of OH variance
7 5,000 underapplied amount is insignificant

Cost of goods sold 5,000

FO, control

CGOS, normal 165,000

Add: underapplied OH 5,000
CGOS, actual 170,000

what if there is an overapplied OH:

FO control
50,000.00 55,000.00
5,000.00

FOC 5,000.00
COGS 5,000

COGS NORMAL 165,000

Less: overapplied 5,000
cogs actual 160,000
Accounts payable
5/1 bal 10,000 DM control 80,000
purchases 80,000 AP 80,000

WIP 76,000
5/31 bal 12,000 DM, control 76,000

FO control

Oh applied 50,000
WIP 50,000
FO control 50,000

cost of goods sold

cost of good sold 165000
FG 165000

FG 147,000
WIP 147,000

50 per MH

23,500
1000mh x 50 50,000
 increased in COGS= decrease in profit
5000

#NAME?
 materials work in process
jan.1 30,000 req. 40,000 jan. 1 2,000 mfd
purch 70,000 DM used 40,000
jan. 31 60,000 DL 66,000
Oh applied 44,000
jan. 31 72,000

finished goods cost of goods sold

jan. 1 20,000 sold 60,000 sold 60,000
mfd 80,000
jan. 31 bal. 40,000

accrued payroll
jan. 1 2,000
gross payro 80,000

59 60,000
60 66,000 11,000 dlh x 6

61 80,000 given
62 44,000 11,000 dlh x 4 WIP
63 72,000 Factory overhead, applied
64 40,000 (charge OH to production)
65 #REF!
66 60,000 FO, control
67 #REF! underapplied various accounts
68 #REF!

FO, applied
FO variance
FO, Control

Cost of goods sold

FO variance

COGS, normal 60,000.00

underapplied OH 4,000.00
COGS, actual 64,000.00
 80,000

total payroll 80000

direct labor 66,000 11000 x 6
indirect labor 14,000

factory payroll 80,000

accrued payroll 80000

WIP 66,000
FO control (indirect labor) 14,000
factory payroll 80000

or
44,000 WIP 44,000
44,000 FO, Control 44,000

48,000 FO, control 48,000

48,000 various accounts 48,000

44,000 FO CONTROL
4,000 actual applied
48,000 48,000 44,000
bal. 4,000

4,000 COGS 4,000

4,000 FOC 4,000