1st Quiz -COST ACCPUNTING AND CONTROL

1. Forbes Company uses a predetermined overhead rate based on direct labor hours to apply
manufacturing overhead. At the beginning of the period, the company estimated manufacturing
overhead would be P18,000 and direct labor hours would be 15,000. The actual figures were
P19,500 for manufacturing overhead and 16,000 direct labor-hours. The cost record for the
period will show:
a. overapplied overhead of P300 c. underapplied of P1,500
b. overapplied overhead of P1,500 d. underapplied of P1,300

2. The Chicken Lang Daw Ang Accounting Corporation manufactures chicken nuggets. During
the fiscal year just ended, the company incurred prime cost of P1,500,000 and conversion cost of
P1,800,000. Overhead is applied at the rate of 200% of direct labor cost. How much of the above
costs represent material cost?
a. P1,500,000 c. P900,000
b. P300,000 d. P600,000

3. Handy Crafts Co. manufactures to customers specifications. The company summarizes the
following information:
Beginning work in process inventory P300,000
Orders completed 2,400,000
Orders shipped out 2,000,000
Materials requisitioned 1,700,000
Direct labor cost 800,000
Overhead = 150% of direct labor cost.
The month-end work in process inventory was;
a. P700,000 c. P1,400,000
b. P800,000 d. P1,600,000

4. Flor Company consumed P450,000 worth direct materials during May 2022. At the end of the
month, the direct materials inventory of Flor was P25,000 lower than the May 1 inventory level.
How much was the direct materials procured during May 2022?
a. P475,000 c. P400,000
b. P375,000 d. P425,000

5. During the current accounting period, a manufacturing company purchased P70,000 of raw
materials, of which P50,000 of direct materials and P5,000 of indirect materials were used in
production. The company also incurred P45,000 of total labor costs and P20,000 of other factory
overhead costs. An analysis of the work in process control account revealed that P40,000 of
direct labor costs. Based upon the above information, what is the total amount accumulated in
the factory overhead control account?
a. P25,000 c. P45,000
b. P30,000 d. P50,000
6. The following information was taken from Kay Co. accounting records for the year ended
December 31:
Increase in raw materials inventory P15,000
Decrease in finished goods inventory 35,000
Raw materials purchased 430,000
Direct manufacturing labor payroll 200,000
Factory overhead 300,000
Freight out 45,000
There was no work in process inventory at the beginning or end of the year. Kay’s cost of goods
sold is.
a. P950,000 c. P975,000
b. P965,000 d. P995,000

7. X-files Production Inc. has manufactured 100,000 units of compound X in May at the
following costs:
Labor of P242,500 of which 93% represents direct labor
Materials of P182,500 of which 90% represents direct materials
Opening work in process of P88,125
Closing work in process inventory of P67,500
Factory overhead is 125% of direct labor costs and includes indirect materials and indirect labor.
Compute the cost of goods manufactured.
a. P671,150 c. P651,056
b. P692,306 d. P629,900

Polytechnic Co.’s records were destroyed by fire. The controller was able to ascertain that sales
for the nine month period ending September 30 were P1,250,000. The company’s suppliers
indicated that merchandise costing P500,000 was delivered for the period. The company’s
statement indicated that the ending inventory for the previous accounting period was P260,000.
The company was reimbursed by its insurance company for P200,000 worth of inventory
destroyed by the fire. Insurance companies pay 80% of the cost for casualty of this nature.

8. There were no other inventories on hand. Compute the estimated cost of goods sold for the
period?
a. P760,000 c. P250,000
b. P510,000 d. P560,000

9. The amount of loss to the company?

a. P50,000 c. P200,000
b. P250,000 d. P100,000
Item 10-12 Santo Bagsik Company manufactures unique, custom made furniture. The company
uses job order system and applies overhead to production on the basis of direct labor cost. In
computing a predetermined overhead rate for the year 2022, the company estimated
manufacturing overhead to be P32,500,000 and direct labor cost to be P25,000,000.
Actual cost incurred during 2022.
Direct material used P37,500,000
Direct labor cost incurred 22,500,000
Insurance- factory equipment 625,000
Indirect labor 9,375,000
Factory maintenance 2,500,000
Rent – factory building 13,750,000
Depreciation – factory equipment 2,500,000

10. The company applies factory overhead into production on the basis of direct labor cost using
a predetermined rate of?
a. 77% c. 1.15
b. 1.30 d. 30%

11.Compute the amount of under or over applied overhead for 2022?

a. P700,000 c. P600,000
b. P250,000 d. P500,000

12. Determine the actual cost of goods sold given the following additional data
January 1, 2022 December 31, 2022
Work in process P6,250,000 P5,000,000
Finished goods 16,250,000 13,750,000

a. P93,000,000 c. P92,000,000
b. P93,500,000 d. P92,500,000
Data for the past 10 months were collected for Kristal Inc. to estimate the variable and fixed
manufacturing overhead. The following data on supplies cost and direct labor hours from
January to October are available.
X Y
Direct Labor Hours Supplies Cost
20 P50
40 110
60 150
20 70
30 80
40 100
50 150
10 60
30 110
50 120

13. The vaiable cost per unit using high-low method?

a. P1.80 c. P80
b. P1.08 d. P100

14. The fixed cost portion using high-low method?

a. P60 c. P150
b. P42 d. P108

Last month, Pare Co. placed P60,000 of materials into production. The Printing department used
8,000 labor hours at P5.60 per hour and the Binding department used 4,600 hours at P6.00 per
hour. Factory overhead is applied at a rate of P6.00 per labor hour in the Printing Department
and P8.00 per labor hour in the Binding Department. Pare’s inventory accounts show the
following balances:
Beginning Ending
Finished goods P22,000 P17,000
Work in process 15,000 17,600
Materials 20,000 18,000
15. What is the cost of goods manufactured?
a. P214,600 c. P232,200
b. P219,600 d. P236,600

16. What is the cost of goods sold?

a. P214,600 c. P232,200
b. P219,600 d. P236,600
17-18 Fusion Company has the following data on April 30, 2019.
April manufacturing overhead P30,101.80
Decrease in ending inventories:
Materials 2,430.00
Goods in process 590.00
Increase in ending inventory:
Finished goods 1,320.40

The manufacturing overhead amounts to 50% of the direct labor and the direct labor and
manufacturing overhead combined equal 50% of the total cost of manufacturing. All materials
are purchased F.O.B shipping point.
17. What is the total manufacturing cost?
a. P90,305.40 c. P181,510.80
b. P180,400.80 d. P180,610.80

18. What is the cost of goods manufactured?

a. P90,305.40 c. P181,510.80
b. P181,200.80 d. P180,200.80

19. Lunas Company year end manufacturing costs were as follows:

Direct materials and direct labor P500,000
Depreciation of manufacturing equipment 70,000
Depreciation of factory building 40,000
Janitors wages for cleaning factory premises 15,000
How much of these costs should be inventoried for external reporting purposes?

a. P625,000 c. P585,000
b. P610,000 d. P500,000

20. The following selected information pertains to Ajax Co.: Direct materials, P62,500; indirect
materials, P12,500; factory payroll, P75,000 of direct labor and P11,250 of indirect labor; and
other factpry overhead incurred, P37,500. The toal conversion cost was:
a. P136,250 c. P250,000
b. P137,500 d. P273,750