De Leon Solman 2014-2 Cost PDF

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COST ACCOUNTING 2014 EDITION DE LEON Chapter 1 1. TRUE 2. TRUE 3. FALSE 4. TRUE 5. TRUE 6. FALSE 7. TRUE 8. FALSE 9. TRUE 10 MULTIPLE CHOICE 1. B 2. C 3. A 4. C 5. C 6. D 7. A 8. A 9. B 10 Chapter 2 Costs Concepts and classification Problem Ram Corporation 1. Manufacturing overhead 2. Manufacturing ...

Description

COST ACCOUNTING 2014 EDITION DE LEON

TRUE/FALSE 1. TRUE 2. TRUE 3. FALSE 4. TRUE 5. TRUE

6. FALSE 7. TRUE 8. FALSE 9. TRUE 10.TRUE

MULTIPLE CHOICE 1. B 2. C 3. A 4. C 5. C

6. D 7. A 8. A 9. B 10.D

– Problem 1- Ram Corporation 1. Manufacturing overhead 2. Manufacturing overhead 3. Direct materials 4. Direct labor 5. Manufacturing overhead 6. Manufacturing overhead 7. Direct materials 8. Manufacturing overhead 9. Manufacturing overhead 10. Manufacturing overhead

1. Manufacturing 2. Selling 3. Manufacturing 4. Selling 5. Administrative

6. Manufacturing 7. Administrative 8. Seling 9. Administrative 10.Selling

11. D 12. B 13. B 14. A 15. D

Product Cost Direct mat. Direct labor Adm 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 1. 2. 3.

DM Factory rent Direct labor Factory utilities Supervision Depreciation-FE Sales Commission Advertising Depreciation-OE Salary - pres.

Period Cost Mfg. OH Selling

220,000 50,000 180,000 8,500 60,000 20,000 57,000 47,000 10,000 250,000

TOTAL PRODUCT CST = 220,000 + 180,000 + 138,500 TOTAL PERIOD COST = 57,000 + 307,000 COST PER UNIT = 538,500/ 40,000 units = P 13,4625 –

1. Fixed 2. Fixed 3. Fixed 4. Variable 5. Fixed

a. b. c. d. e. f. g. h.

Period Inventoriable Inventoriable Inventoriable Inventoriable

6. Variable 7. Variable 8. Fixed 9. Fixed 10. Fixed

– P 50,000 P 50,000 P 60,000 = P120/muffler x 400 = P 48,000 500 P 120 x 800 = P 96,000 P 50,000 + P 48,000 = P 98,000 P 50,000 + P 96,000 = P 146,000 P 50,000/ 400 = P 125 P 50,000/500 = P 100

Period Inventoriable Inventoriable Period Inventoriable

I, j. k. l. m. n. o.

P 50,000/800 P 48,000/400 P 60,000/500 P 96,000/800 P 125 + P 120 P 100 + P 120 P 62.50 + P 120

=P =P =P =P = P = P = P

62.50 120 120 120 245 220 182.50

– 1. DM 2. OH 3. OH 4. OH 5. DL 6. OH 7. OH 15. DM

8. 9. 10. 11. 12. 13, 14.

OH OH DL OH OH OH OH

– 1. Prime costs 2. Conversion cost 3 Inventoriable cost 4. Total period costs

-

530,000 575,000 860,000 305,000

– a. c - fixed (total amount is constant) b. a – variable (4,480/3,200 = 1.40; 6,300/4,500 = 1.40 per unit is constant) c. d - mixed ( 3,950/3,200 = 12.34; 5,250/4,500 = 1.16) total amount and amount per unit varies in relation to units sold)

`

1. Direct materials used Direct labor Variable manufacturing overhead Variable marketing Total variable cost per unit X No. of units produced and sold Total variable costs per month

P 32.00 20.00 15.00 3.00 70.00 12,000 P 840,000

2. Fixed manufacturing overhead Fixed marketing costs Total fixed cost per unit X No. of units produced and sold Total fixed costs per month

`

P

6.00 4.00 10.00 12,000 P 120,000

1. Direct materials Direct labor Variable manufacturing overhead Total variable manufacturing cost per unit

P 60.00

2. Total variable manufacturing cost per unit Variable marketing and administrative Total variable costs per unit

P 99.00 6.00 105.00

30.00 9.00 P 99.00

3. Total variable manufacturing cost per unit P 99,00 Fixed manufacturing overhead (30,000/1,200) 25.00 Full manufacturing cost per unit 124.00 4. Full manufacturing cost per unit Variable marketing and administrative Fixed marketing and administrative Full cost to make and sell per unit

124.00 6.00 20.00 150.00

– 1. Variable cost per machine hour = 35,600 – 20,000 4,000 - 2,000 = 7.80 per machine hour 2. Total electricity expense Less: Variable costs ( 4,000 x 7.80) ( 2000 x 7.80) Fixed cost 3. Fixed cost Variable cost ( 4,500 x 7.50)

4,000 hours 35,600 31,200 ______ 4,400

2000 hours 20,000

15,600 4,400 4,400 35,100

1.

Totl manufacturing costs 39,500 – Variable cost per machine hour = 5,475 – 3,975 210 - 145 = 23.08 per machine hour

2.

210 hours 5,475

Total overhead costs Less: Variable costs ( 210 x 23.08) ( 145 x 23.08) Fixed cost

145 hours

4,847 _____ 628

3,975

3,347 628

– 1.

Direct materials Direct labor Factory supplies Direct variable costs

2.

Controllable direct fixed costs Supervisory salaries

3.

Department A P 400,000 350,000 10,000 P 760,000

P

Uncontrollable direct fixed costs: Depreciation – machinery and Equipment P

4. Controllable direct fixed cost Uncontrollable direct fixed cost Total direct fixed cost

45,000

100,000 P 45,000 100,000 P 145,000

5. Allocated costs from headquarters P 120,000 Allocated repairs & maintenance 40,000 Allocated factory rent – bldg. 60,000 Allocated plant executive’s salaries 140,000 Total indirect costs P 360,000 6. Allocated costs from headquarters Allocated factory rent – bldg. Allocated plant executive’s salaries

P 120,000 60,000 140,000

Department B P 700,000 600,000 24,000 P 1,324,000

P

P

55,000

180,000 P 55,000 180,000 P 235,000

P 180,000 80,000 140,000 210,000 P 610,000 P 180,000 140,000 210,000

Depreciation- mach. & equipment Total unavoidable costs

P

100,000 420,000

True/False Questions 1. False 6. True 2. False 7. False 3. True 8. True 4. False 9. False 5. False 10. True

11. False 12. False 13. True 14. False 15. False

1. B 2. C 3. B 4. C 5. D 6. A 7. D 8. D 9. B 10. C

21. A 22. C 23. A 24. C 25. D 26. B 27. A 28. B 29. C 30. B

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.

11. C 12. D 13. C 14. B 15. A 16. B 17. B 18. A 19. D 20. B

A A A, C A A B A A, C A A A C A A C

P

180,000 710,000

16. True 17. False 18. True 19. False 20. True

Marvin Manufacturing Company Cost of Goods Sold Statement For the year ended December 31, 2014

Direct materials used Materials, January 1 Purchases Total available for use Less> Materials, December 31 Direct labor Factory overhead Total manufacturing costs Work in process, January 1 Cost of goods put into process Less: Work in process, December 31 Cost of goods manufactured Finished goods, January 1 Total goods available for sale Less: Finished goods, December 31 Cost of goods sold

175,000 250,000 425,000 125,000

– Donna Company Cost of Goods Sold Statement For the month of May, 2014 Direct materials used Materials, May 1 Purchases

124,000 107,800

300,000 270,000 324,000 894,000 90,000 984,000 120,000 864,000 100,000 964,000 80,000 884,000

Total available Less> Material - May 31 Direct labor Factory overhead Total manufacturing costs Work in process, May 1 Cost of goods put into process Less: Work in process, May 31 Cost of goods manufactured Finished goods – May 1 Total goods available for sale Less: Finished goods – May 31 Cost of goods sold

1, Entries a. Materials Accounts payable b. Payroll Withholding taxes payable SSS Premiums payable Phil Health contributions payable Pag-ibig funds contributions payable Accrued payroll Work in process Factory overhead control Payroll c. Materials Accounts payable d. Factory overhead control SSS premiums payable Phil Health contributions payable Pag-ibig funds contributions payable e. Work in process Factory overhead control Materials

231,800 115,000

116,800 160,000 240,000 516,800 129,200 646,000 124,000 522,000 150,000 672,000 122,000 550,000

150,000 150,000 75,000 11,200 2,400 375 1,620 59,405 56,000 19,000 75,000 20,000 20,000 5,595 3,600 375 1.620 120,000 10,000 130,000

f. Accounts payable Materials g. Accounts payable Accrued payroll Cash h. Factory overhead control Miscellaneous accounts i. Work in process Factory OH Applied (56,000 x 120%) j. Finished goods Work in process k. Accounts receivable Sales Cost of goods sold Finished goods

2,000 2,000 148,300 59,405 207.705 24,900 24,900 67,200 67,200 175.000 175,000 2200,000 2200,000 140,000 140,000

2. Statement of cost of goods sold . Direct materials used Purchases 170,000 Less: Purchase returns 2,000 Total available for use 168,000 Less: Ind. Mat. used 10,000 Mat.- October 31 38,000 48,000 120,000 Direct labor Factory overhead Total manufacturing costs Less: Work in process, October 31 Cost of goods manufactured Less: Finished goods – March 31 Cost of goods sold, normal Less: OA-FO Cost of goods sold, actual Actual factory overhead (FO Control ) Less: Applied factory overhead Over applied factory overhead

– 1. Entries

56,000 67,200 243,200 68,200 175,000 35,000 140,000 7,705 132,295

59,495 67,200 ( 7,705)

a. Materials Accounts payable b. FOControl Accounts payable

c. Payroll W/Taxes payable SSS Premium payable Phil Health contributions payable PFC payable Accrued payroll Work in process Factory Overhead control Selling expense control Adm. expense control Payroll

200,000 200,000 35,000 35,000

210,000 18,520 8,400 1,125 6,300 175,655 140,000 30,000 25,000 15,000 210,000

d. Accrued payroll Cash

175,000 175,000

e. FO Control Selling expense control Adm. Expense control SSS prem. Payable MC payable PFC payable

14,200 2,375 1,350 10,500 1,125 6,300

f. Work in process FO Control Materials

185,000 35,000

g. Work in process FO Applied (140,000x80%)

112,000

h. Finished goods Work in process

220,000

112,000 410,000 410,000

i. Accounts receivable Sales Costs of goods sold Finished goods

539,000 539,000 385,000 385,000

j. Cash Accounts receivable k. Accounts payable Cash

405,000 405,000 220,000

2. Cost of goods sold statement Direct materials used Materials, January 1 50,000 Purchases 200,000 Total available 250,000 Less> Mat.- Jan. 31 30,000 Ind. Materials 35,000 65,000 Direct labor Factory overhead Total manufacturing costs Work in process, January 1 Cost of goods put into process Less: Work in process, January 31 Cost of goods manufactured Finished goods – January 1 Total goods available for sale Less: Finished goods – January 31 Cost of goods sold - normal Underapplied factory overhead Cost of goods sold – actual

220,000

185,000 140,000 112,000 437,000 18,000 455,000 45,000 410,000 35,000 445,000 60,000 385,000 2,200 387,200

3. Income Statement Sales Less: Cost of goods sold Gross profit Less: Operating expenses Selling Administrative Net income 4 Balance sheet Cash Accounts receivable Finished goods 18,520 Work in process Materials

Total

539,000 387,200 151,800 27,375 16,350

110,000 194,000 60,000 45.000 30,000

_______ 439,000

1, Income Statement Sales Less: Cost of goods sold Gross profit Less: Operating expenses Marketing Administrative Net income 2. Cost of goods sold statement Direct materials used Materials, March 1 Purchases Total available Less> Mat.- March 31 Direct labor

43,725 108,075

Accounts payable Accrued payroll W/tax payable

25,000 8,655

SSS Prem. payable 18,900 Medicare Cont. payable 2,250 PFC payable 12,600 Common stock 200,000 Retained earnings 153,075 439,000

1,200,000 755,230 444,770 60,000 12,000

50,000 400,000 450,000 47,485

72,000 372,770

402,515 210,000

Factory overhead Total manufacturing costs Work in process, March 1 Cost of goods put into process Less: Work in process, March 31 Cost of goods manufactured Finished goods – March 1 Total goods available for sale Less: Finished goods – March 31 Cost of goods sold

1.

140,000 752,515 102,350 854,865 117,135 737,730 100,000 837,730 82,500 755,230

Cost of goods manufactured Work in process, December 31 Cost of goods put into process Total manufacturing costs Work in process, January 1

800,000 87,000 887,000 ( 790,000) 97,000

2.

Cost of goods manufactured Finished goods, January 1 Total goods available for sale Cost of goods sold Finished goods, December 31

800,000 80,000 880,000 (750,000) 130,000

4.

Direct materials used Materials, December 31 Total available for sale Materials, January 1 Materials purchased

590,000 150,000 740,000 (100,000) 640,000

– 1. The company is using job order costing because the it is manufacturing a 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 Overapplied overhead ( 2,000,000)

4. Direct materials used Direct labor Factory overhead applied Total manufacturing cost Work in process, January 1 Work in process, December 31 Cost of goods manufactured Finished goods, January 1 Finished goods, December 31 Cost of goods sold – normal

30,000,000 20,000,000 24,000,000 74,000,000 5,000,000 ( 4,000,000) 75,000,000 13,000,000 (11,000,000 77,000,000

1,

Materials, October 1 Purchases Materials, October 31 Direct materials used Direct labor Factory overhead Total manufacturing costs

25,000 180,000 (40,000) 165,000 220,000 200,000 585,000

2.

Total manufacturing costs Work in process, Oct. 1 Work in process, Oct. 31 Cost of goods manufactured

585,000 23,500 ( 15,000) 593,500

3.

Cost of goods manufactured Finished goods, Oct. 1 Finished goods, Oct. 31 Cost of goods sold

593,500 37,000 ( 31,000) 599,500

Sales Cost of goods sold Net income

980,000 ( 599,500) 380,500

4.

–

1,

Sales (50,000/10%) Selling & administrative expenses Net income Cost of goods sold

500,000 ( 50,000) ( 50,000) 400,000

2.

Cost of goods sold Finished goods, March 31 Finished goods, March 1 Cost of goods manufactured

400,000 180,000 ( 120,000) 460,000

3.

Cost of goods manufactured Work in process, March 31 Work in process, March 1 Total manufacturing costs Factory overhead Direct labor (126,000/75%) Direct materials used Materials, March 31 Purchases Materials, March 1

460.000 100,000 ( 90,000) 470,000 (126,000) (168,000) 176,000 20,000 (100,000) 96,000

1.

Cost of goods manufactured Work in process, December 31 Cost of goods put into process

1,700,000 500,000 2,200,000

2. 3.

(a) (b) (c)

Cost of goods manufactured + WP, end = TMC + WP, beg 1700,000 + X = 1,800,000 + .80X X - .80X = 1,800,000 – 1,700,000 X = 100,00/.20 = 500,000 WP, Dec. 31 = 500,000 Total manufacturing cost 1,800,000 Factory overhead ( (1,800,000 x 25% ) ( 450,000) Direct labor (450,000/72%) ( 625,000) Direct materials used 725,000 P 250,000 P 805,000 P 710,000

(725,000 – 280,000 – 195,000 ) (725,000 + 80,000) (805,000 - 95,000)

(d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n)

P 120,000 P 110,000 P 30,000 P 65,000 P 513,000 P 438,000 P 135,000 P 478,000 P 93,000 P 75,000 P 105,000

(830,000 – 710,000) (830,000 – 720,000) (540,000 – 510,000) (540,000 – 475,000) (475,000 + 38,000) (513,000 – 75,000) (380,000 – 90,000 – 155,000) (98,000 + 380,000) (478,000 – 385,000) (460,000 – 385,000) (460,000 – 355,000)

Multiple choice THEORIES 1. A 2. C 3. B 4. C 5. B 6. B 7. C 8 C 9. D 10.D

PROBLEMS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

B A D B D C B B B C

11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

True or False 1. False 6. True 11. False 2. True 7. False 12. False 3. True 8. False 13. False 4. False 9. True 14. False 5. True 10.False 15. False

Multiple choice – Theory 1, d 6. d 2. b 7. a 3. b 8. c 4. d 9. c 5. d 10. b

11. 12. 13. 14. 15.

B C C D B B B B B D

21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

16.True 17. False 18. False 19. True 20. False

d d c b c

16. 17. 18 19. 20.

a c b b b

21. 22. 23. 24. 25.

c b d b b

A B B 116,000 B A D D B A A

– 1 Journal entries 1. Materials Accounts payable 2.

3.

4.

28,000 28,000

Work in process Factory overhead control Materials

22,000 3.000 25,000

Materials Work in process FO Control Accounts payable Materials

5. Payroll Withholding taxes payable SSS Premiums payable Phil Health contributions payable Pag-ibig funds contributions payable Accrued payroll

800 500 300 1,000 1,000 39,000 3,025 1,600 375 1,200 32,800

Accrued payroll Cash

32,800 32,800

6. Work in process Factory overhead control Payroll 7.

8

33,400 5,600 39,000

Factory Overhead Control SSS Premiums payable Phil Health cont. payable Pag-ibig cont. payable

3,575 2,000 375 1,200

FO Control Accum Depr. Prepaid ins. Accounts payable

15,000

9.

Work in process FO Applied

26,720 26,720

10.

Finished goods WP Job 401

72,220 72,220

3,000 950 11,050

31,720

Job 402 11.

12.

40,500

Accounts receivable Sales (31,720 x 140%)

44,408 44,408

Cost of goods sold FG

31,720 31,720

Cash

35,000 35,000

Accounts receivable

Direct materials 3,000 5,500 8,500

Direct materials 5,600 7,000 12,600 Page 3 Direct materials 9,500 ( 500)

Job 401 Direct labor 2,500 10,400 12,900

Factory overhead 2,000 8,320 10,320

Job 402 Direct labor 3,000 12,500 15,500

Factory overhead 2,400 10,000 12,400

Job 403 Direct labor 10,500

Factory overhead 8,400

3. Cost of goods sold statement Direct materials used Materials, August 1 Purchases Less. Purchase returns Total available for use Less: Materials, Aug. 31 Ind. Materials Direct labor Factory overhead Total manufacturing costs Work in process, Aug. 1 Cost of goods put into process Less: Work in process, Aug. 31 Cost of goods manufactured Finished goods, Aug. 1

22,000 28,000 1,000

27,000 49,000 24,800 2,700

27,500

21,500 33,400 26.720 81,620 18,500 100.120 27,900 72,220 25,000

Total goods available for sale Less: Finished goods, Aug. 31 Cost of goods sold - normal Add. Under applied factory overhead Cost of goods sold

97,220 65,500 31,720 155 31,875

2. Journal entries a. Materials Accounts payable````` X 20,000 x 5.20 = 104,000 Y 24,000 x 3.75 = 90,000 Ind. Materials 35,040 b. Payroll Withholding taxes payable SSS premiums payable Phil Health cont. payable Pag-ibig funds cont. payable Accrued payroll Accrued payroll Cash

Factory overhead control Marketing & adm. Exp. Control SSS Premiums payable Phil Health contr. Payable Pag-ibig funds contribution payable

d. Work in process Factory overhead control Materials Job 101

220,000 31,000 7,000 440 6,600 174,960 174,960 174,960
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