CHAPTER 3 – COST ACCOUNTING CYCLE
Problem 1 – QUEEN MANUFACTURING CORPORATION
1. Direct materials used 950,000
Direct labor 1,100,000
Factory overhead (1,100,000 X 70%) 770,000
Total manufacturing cost 2,820,000
Work in process, January 1 250,000
Cost of goods put into process 3,070,000
Less: Work in process, December 31 100,000
Cost of goods manufactured 2,970,000
2. Cost of goods manufactured 2,970,000
Finished goods, January 1 150,000
Total goods available for sale 3,120,000
Less: Finished goods, December 450,000
Cost of goods sold 2,670,000
3. Sales 3,000,000
Less: Cost of goods sold 2,670,000
Gross profit 330,000
Less: Selling and general expenses 750,000
Gross profit (loss) ( 420,000)
Problem 2 – Marvin Manufacturing Company
Marvin Manufacturing Company
Cost of Goods Sold Statement
For the year ended December 31, 2011
Direct materials used
Materials, January 1 125,000
Purchases 150,000
Total available for use 275,000
Less> Materials, December 31 65,000 210,000
Direct labor 70,000
Factory overhead 105,000
Total manufacturing costs 385,000
Work in process, January 1 90,000
Cost of goods put into process 475,000
Less: Work in process, December 31 120,000
Cost of goods manufactured 355,000
Finished goods, January 1 100,000
Total goods available for sale 455,000
Less: Finished goods, December 31 80,000
Cost of goods sold 375,000
Problem 3 – Donna Company
Donna Company
Cost of Goods Sold Statement
For the month of May, 2011
Direct materials used
Materials, May 1 24,000
Purchases 57,800
Total available 81,800
Less> Material – May 31 15,000 66,800
Direct labor 60,000
Factory overhead 90,000
Total manufacturing costs 216,800
Work in process, May 1 29,200
Cost of goods put into process 246,000
Less: Work in process, May 31 24,000
Cost of goods manufactured 222,000
Finished goods – May 1 50,000
Total goods available for sale 272,000
Less: Finished goods – May 31 22,000
Cost of goods sold 250,000
Problem 4 – Ram Company
1, Entries
a. Materials 150,000
Accounts payable 150,000
b. Payroll 75,000
Withholding taxes payable 11,200
SSS Premiums payable 2,400
Phil Health contributions payable 375
Pag-ibig funds contributions payable 1,620
Accrued payroll 59,405
Work in process 56,000
Factory overhead control 19,000
Payroll 75,000
c. Materials 20,000
Accounts payable 20,000
d. Factory overhead control 5,595
SSS premiums payable 3,600
Phil Health contributions payable 375
Pag-ibig funds contributions payable 1.620
e. Work in process 85,000
Factory overhead control 11,000
Materials 96,000
f. Accounts payable 4,000
Materials 4,000
g. Accounts payable 148,300
Accrued payroll 59,405
Cash 207.705
h. Factory overhead control 24,900
Miscellaneous accounts 24,900
i. Work in process 67,200
Factory OH Applied (56,000 x 120%) 67,200
j. Finished goods 165.000
Work in process 165,000
k. Accounts receivable 190,000
Sales 190,000
