Question

PREPARE T-ACCOUNT

1. Job 11
2. Job 12
3. Job 13
4. Job 14
5. Job 16
6. Raw Materials
7. Work-in Process
8. Finished Goods
9. Factory Overhead
10. Sales Commission
11. Administrative Salaries
12. Salaries and Wages Payable
13. Advertising Expense
14. Depreciation
15. Accumulated Depreciation
16. Sales
17. Cost of Goods Sold
18. Accounts Payable
19. Accounts Receivable
20. Cash

TO THE FF:

SHELL CORP. uses job order costing system has the following balances as of January 2, 2021.

Materials          P5,000.00

Work in Process (Job 11)   1,112.50

Finished Goods (Job 10)                 12,500.00

1. Purchases of materials P105,000 on account

Raw Materials              P105,000.00

            Accounts Payable               P105,000.00

2. Materials requisitioned(issued) for production P97,500: indirect materials P5,000.00, Job 11 P10,250; Job 12 P22,875; Job 13 P28,187.50; Job 14 P8,062.50; Job 15 P16,250 and Job 16 P6,875.

WIP – 11          10,250.00

WIP – 12          22,875.00

WIP – 13          28,187.50

WIP – 14          8,062.50

WIP – 15          16,250.00

WIP – 16          6,875.00

FOH Control    5,000.00

            Raw Materials              97,500.00

3. Materials returned to storeroom from the factory totaled P3,000 of which P1 ,000 Job 11 and the balance was for indirect materials.

Materials          3,000.00

            WIP – 11          1,000.00

            FOH Control    2,000.00

4. P106,750 were incurred for employee services. Of the payroll: direct labor P83,750; indirect labor P12,000; sales commission P5,000 and administrative salaries P6,000. The direct labor was distributed as follows: Job 11 P3,437.50; Job 12 P18,125; Job 13 P35,812.50; Job 14 P7,000; Job 15 P15,250 and Job 16 P4,125.

Payroll             106,750.00

            Salaries and Wages Payable      P106,750.00

WIP – 11          3,437.50

WIP – 12          18,125.00

WIP – 13          35,812.50

WIP – 14          7,000.00

WIP – 15          15,250.00

WIP – 16          4,125.00

FOH Control    12,000.00

Sales Commission   5,000.00

Administrative Salaries 6,000.00

            Payroll                         106,750.00

5. Payment of payroll is P90,000.

Salaries and Wages Payable      90,000.00

            Cash                                                    90,000.00

6. Manufacturing overhead costs are charged to jobs on the basis of P1.50 per direct labor hour used. The following are the direct labor hours used by each job. Job 11- P3,250 ; Job 12 – 9,250; Job 13 – 20,500; Job 14 – 3,750 ; Job 15 – 8,000 and Job 16 – 2,450. Any over or under-applied manufacturing overhead is charged to cost of goods sold account.

WIP – 11          (3,250 hours x 1.50) 4,875.00

WIP – 12          (9,250 hours x 1.50) 13,875.00

WIP – 13          (20,500 hours x 1.50) 30,750.00

WIP – 14          (3,750 hours x 1.50) 5,625.00

WIP – 15          (8,000 hours x 1.50) 12,000.00

WIP – 16          (2,450 hours x 1.50) 3,675.00

            FOH Applied                                       70,800.00

7. Utility Cost incurred in the factory totaled P15,000

FOH Control    15,000.00

            Accounts Payable         15,000.00

8. Advertising Costs paid totaled P20,000.

Advertising Expense     P20,000.00

            Accounts Payable                     P20,000.00

9. Depreciation was recorded for the year P50,000(40% for selling and administrative activities and the balance to factory operations).

Depreciation Expense (50,000 * 40%) 20,000.00

FOH Control                (50,000 * 60%) 30,000.00

            Accumulated Depreciation(CR)             50,000.00

10. During the month, Job order nos. 11, 12, 14 and 15 were completed.

Finished Goods – 11     18,675.00

Finished Goods – 12     54,875.00

Finished Goods – 14     20,687.50

Finished Goods – 15     43,500.00

            WIP – 11                      18,675.00

            WIP – 12                      54,875.00

            WIP – 13                      20,687.50

            WIP – 14                      43,500.00

11. Job 11 and 12 were shipped out and the customers were billed for 180% of costs.

Cost of Goods Sold                               73,550.00

            Finished Goods – 11                                         18,675.00

            Finished Goods – 12                                         54,875.00

Accounts Receivable    (73,550 x 1.8)   132,390.00

            Sales                                                                132,390.00

Answer 1

Job 11
Beg. bal.	1,112.50	3.	1,000
2.	10,250	10.	18,675
4.	3,437.50
6.	4,875
End. bal.	0
Job 12
Beg. bal.	0	10.	54,875
2.	22,875
4.	18,125
6.	13,875
End. bal.	0
Job 13
Beg. bal.	0
2	28,187.50
4.	35,812.50
6.	30,750
End. bal.	94,750
Job 14
Beg. bal.	0	10.	20,687.50
2	8,062.50
4	7,000
6	5,625
End. bal.	0
Job 15
Beg. bal.	0	10	43,500
2	16,250
4	15,250
6	12,000
End. bal.	0
Job 16
Beg. bal.	0
2	6,875
4	4,125
6	3,675
End. bal.	14,675
Raw Materials
Beg. bal.	5,000	2.	97,500
1.	105,000
3	3,000
End. bal.	15,500
Work in Process
Beg. bal.	1,112.50	3	1,000
2	92,500	10.	137,737.50
4.	83,750
6.	70,800
End. bal.	109,425
Finished Goods
Beg. bal.	12,500	11.	73,550
10.	137,737.50
End. bal.	76,687.50
Factory Overhead
2.	5,000	3.	2,000
4.	12,000	6.	70,800
7.	15,000
9.	30,000
Overapplied	10,800
Sales Commission
4.	5,000
	5,000
Administrative Salaries
4.	6,000
	6,000
Salaries and Wages Payable
5.	90,000	4.	106,750
		End. bal.	16,750
Advertising Expense
8.	20,000
	20,000
Depreciation Expense
9.	20,000
	20,000
Accumulated Depreciation
		9.	50,000
			50,000
Sales
		11.	132,390
			132,390
Cost of Goods Sold
11.	73,550		10,800
	62,750
Accounts Payable
		1.	105,000
			105,000
Accounts Receivable
11	132,390
	132,390