You are asked to bring the following incomplete accounts of SYM Company updated through

May 2016.
Direct Materials
Accounts Payable
| 5/31/16 P20,000
| 4/30/16 P 10,000
|

Work in Process
4/30/16 P2,000 |

Factory overhead control

P55,000
|

Finished Goods
4/30/16 P25,000 |

Cost of Goods Sold

|

Additional information:
(a) The overhead is applied using a budgeted rate that is set at the beginning of each year
by forecasting the years overhead and relating it to forecasted machine hours. The
budget for 2016 called for a total of 15,000 machine hours and P750,000 of factory
overhead.
(b) The accounts payable is for direct materials purchases only. The balance on May 31,
was P12,000. Payment of P78,000 were made during May.
(c) The finished goods inventory as of May 31 was P7,000.
(d) The cost of goods sold during the month was P165,000.
(e) On May 31, there was only one unfinished Job in the factory. Cost record shows that
P1,000 (40 hours) of direct labor and P2,000 of direct materials had been charged to
Job. Thirty machine hours were used on that Job.
(f) Total of 940 direct labor hours were worked during the month of May. All factory workers
earn the same rate of pay.
(g) All actual overhead incurred during May has already been posted.
(h) A total of 1,000 machine hours was used during May.
Required: 1) Cost of Goods Sold Statement, 2) Compute for the under/over applied overhead, 3)
Prepare all necessary journal entries
Problem #2: Wesley Company makes two products, A and B. At the
beginning of October, account balances were:
Raw materials*
P20,000
Work in process
P0
Finished goods
0
Accrued payroll
0
*Consist of 1,000 lbs of X @ P12 and 2,000 lbs of Y @ P4
Overhead is allocated to products at a rate of P12 per direct labor hour.
During October, the following transactions took place:
1) 750 pounds of raw material X were issued for production of 1,000 units
of Product A.
2)
375 direct labor hours at an average hourly rate of P15 were used
in manufacturing Product A.
3)
900 pounds of raw materials Y were issued for production of
Product A.
4)
1,000 pounds of raw material Y were issued for production of
2,000 unit of Product B.
5)
300 direct labor hours at an average hourly rate of P15 were
incurred in manufacturing Product B.
6)
2,000 pounds of raw material X were purchased at a cost of
P12.50 per pound.
7)
1,000 pounds of raw material Y were purchased at a cost of P3.90
per pound.
8)
500 pounds of raw material X were issued for production of
Product B.
9)
800 unit of Product A and 1,500 units of Product B were
completed. The incomplete units of Product A were charged with 70
hours of direct labor; the incomplete unit of Product B were charged with
50 direct labor hours.
10)
Actual overhead expenses totaled P8,100
Wesley uses FIFO inventory accounting method.

RANDY CODE : 507

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Required: 1) Journal entries for the transactions above, 2) Cost of Goods Sold
Statement, 3) Simple Job Cost Sheets

RANDY CODE : 507

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