#1- Journal Entries for Cost Accounting Cycle (Without payroll deduction)
The general ledger of the Jaja Bearings Company contained the following
accounts among others, on January 1. Finished Goods, P15,000; Work in Process,
P30,000; Materials, P25,000. Duringf January the following transactions were
completed:
a. Materials were purchased on account at a cost of P 13,500.
b. Steel in the amount of P17,500 was issued from factory.
c. Requisitions for indirect materials and supplies amounted to P1,800.
d. The total payroll for January amounted to P27,000 including marketing
salaries of P5,000 and administrative salaries of P3,000. Job time tickets
show that P17,000 of the labor cost was direct labor. A payroll clearing
accounts is used.
e. Various indirect manufacturing costs totaling P2,508 were paid in cash.
f. Various indirect manufacturing costs totaling P8,500 were incurred on
account.
g. Total factory overhead is charged to Work in Process.
h. Cost of Production completed in January totaled P60,100 and Finished
Goods on January totaled P15,100.
i. Customers to whom shipments were made during the month were billed for
P75,000.
Required: Prepare journal entries for the transactions
#2- Journal Entries for Cost Accounting Cycle (With payroll deduction)
The following transactions pertain to the manufacturing operations of PPG
Company:
a. Materials purchased totaling P100,000
b. Materials were issued as follows:
Direct Materials -P49,000
Indirect Materials – P9,000
c. Total payroll was P60,000 direct labor, P12,000 indirect labor, P6,000 sales
salaries, and P10,000 office salaries. Income tax withheld was 10% of wages
earned, SSS contribution at a rate of 5%. Phil. Health contribution at 1.5%
and Pag-ibig contribution at 1% were deducted. The payroll due to the
employees was paid.
d. The employer’s share of payroll taxes for all categories of employees consists
of 5% SSS contribution, 1.5% Phil. Health contribution, ½% employees
compensation contribution, and 1% Pag-ibig contribution.
e. Miscellaneous factory expenses of P15,000 were paid.
f. Factory overhead of P30,000 was charged to production.
g. Cost of production completed during the period was P120,000.
h. Goods costing P40,000 were billed to customers at a sales price of P52,000.
Required: Prepare the journal entries to record the transactions.
#3- Journal Entries
Selected transactions of the Asser Company for the month of February are as
follows:
a. Materials purchased and received, P64,000.
b. Materials requisitioned: P37,000 for production and P5,600 for indirect use.
c. The payroll after deducting 14% withholding tax, and the employees’ share of
5% SSS contribution, 0.5% Phil. Health contribution; and Pag-ibig contribution
of 0.5%. The wages due the employees were paid.
d. Of the total payroll, 55% was direct labor, 18% was indirect factory labor, 17%
was sales salaries and 10% was administrative salaries.
e. Employer’s contribution for all employee categories:
SSS 5%
Phil. Health 1%
ECC ½%
Pag-ibig P2,000
f. Factory overhead charged to production, P44,000
g. Other factory overhead consisted of P18,000 depreciation on the factory
building and equipment, P1,200 expired insurance, and P2,500 other unpaid
bills.
h. Work completed and transferred to finished goods amounted to P103,000.
i. Sales on account totaled P168,750 with a mark-up of 35% on the cost of
goods sold.
j. Cash collection for accounts receivable totaled P145,000.
Required: Prepare journal entries for the above transactions.
#4- Job Order Cost Entries
The following summary data relate to Gloria Corporation for the month of
October, 2023:
a. Raw materials purchased P200,000
b. Raw materials issued to jobs in process P180,000
c. Total factory payroll accrued for the month P120,000
Payroll deductions:
Income Tax Withheld 5%
SSS Contributions P3,200
Phil. Health contributions P1,300
Pag-ibig contributions P2,000
d. Employer’s share in-
SSS Contributions P5,500
Phil. Health contributions P1,300
Pag-ibig contributions P2,000
e. Payroll distributions:
Direct Labor (8000 hours) P80,000
Indirect Labor P40,000
f. Other factory overhead incurred (excluding labor) P67,500
g. The overhead application rate is P12 per direct labor hour
h. Total costs of jobs completed during the month P320,000
i. All completed jobs were shipped to customers at cost plus 50%
j. Underapplied or overapplied factory overhead is closed to Cost of Goods Sold
Required:
1. Prepare journal entries to record the transactions resulting to the above data.
2. If the balance of Work in Process on October 1 was P15,000, what would be the
October 31 Work in Process balance?
#6 – Journal and Entries and Statement of Cost of Goods Sold.
On January1, the general ledger of Jocelyn Company contained the following
accounts and balances:
Cash P94,000
Accounts Receivable 100,000Ma
Finished Goods 65,000
Work in Process 15,000
Materials 44,000
Machinery 90,600
Accumulated Depreciation-Machinery 20,000
Accounts Payable 118,750
Common Stock 200,000
Retained Earnings 69,850
Details of inventories are:
Finished goods inventory: P65,000
Job 101 Job 102
Work in process inventory:
Direct Materials: 1000 units of A @P5 P5,000
400 units of B @P3 P1,200
Direct Labor: 1000 hours @P4 4,000
400 hours @P5 2,000
Factory Overhead applied at the rate
Of P2 per direct labor hour 2,000 800
Total P11,000 P4,000
Materials Inventory: P44,000
During January, the following transactions were completed:
a. Materials were purchased on account for P229,040.
b. Payroll totaling P220,000 was accrued.
c. Payroll was distributed as follows: Jobs 101, 5000 direct labor hours @P8; Job
102, 8000 hours @P6, Indirect labor, P24,000 and selling and administrative
expenses P40,000.
d. Materials were issued as follows: P103,200 to Job 101; P84,000 to Job 102;
P29,150 to Job 103. Indirect materials costing P15,040 were issued.
e. Factory overhead was applied to Job 101, 102, and 103 at a rate of P4.50 per
direct labor hour.
f. Job 101 and 102 were completed and immediately sold on account for P250,000
and P270,000 respectively.
g. After allowing a 5% cash discount, a net amount ofP494,000 was collected on
accounts receivable.
h. Marketing and administrative expenses (other than salaries) paid during the
month amounted to P30,000. Other factory overhead paid, P49,720.
i. Payments on account, other than payrolls paid, amounted to P170,000.
j. Applied Factory Overhead is closed to Factory Overhead Control. The over or
under applied overhead is then closed to Cost o Goods Sold.
Required:
1. Journalize the January transactions.
2. Prepare a cost of goods sold statement for January.
#7- Journal entries with Inventory Schedule
Neri Inc. had the following inventories on March 1:
Finished Goods (Job 620) P15,000
Work in Process P19,070
Materials P14,000
The Work in Process account controls three jobs:
Job 621 Job 622
Job 623
Materials P2,800 P3,400
P1,600
Labor 2,100 2,700
1,350
Applied Factory Overhead 1,680 2,160
1,080
Total P6,580 P8,260
P4,230
The following information pertains to March operations:
a. Materials purchased and received cost P22,000 at terms n/30.
b. Materials requisitioned for production cost P21,000. Of this amount, P2,400 was
for indirect materials, the difference was distributed: P5,300 to Job 621; P7,400
to Job 622; and P5,900 to Job 623.
c. Materials returned to the storeroom from the factory totaled P600, of which P200
was for indirect materials, the balance from Job 622.
d. Materials returned to vendors totaled P800.
e. Payroll of P38,000 was accrued in March.
f. Of the payroll, direct labor represented 55%; indirect labor, 20%; sales salaries,
15% and administrative salaries, 10%. The direct labor cost was distributed;
P6,420 to Job 621; P8,160 to Job 622; and P6,320 to Job 623.
g. Factory overhead, other than any previously mentioned, amounted to P9,404.50.
Included in this figure were P2,000 for depreciation of factory building and
equipment and P250 for expired insurance on the factory. The remaining
overhead, P7,154.50, was unpaid at the end of March.
h. Factory overhead was applied to production at a rate of 80% of the direct labor
cost to be charged to the three jobs, based on the labor cost for March.
i. Jobs 621 and 622 were completed and transferred to the finished goods
warehouse.
j. Both jobs 620 and 621 were sold and billed at a gross profit of 40% of the cost of
goods sold.
k. Cash collections from accounts receivable during March were P40,000.
Required:
1. Journalize the March transactions.
2. Prepare a schedule of inventories on March 31.
