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Activities/Assessment: 1. Actual and Normal costing method. Swan Manufacturing Company currently uses actual costing method in accumulating cost of production. However, Swan is planning to adopt the normal costing system starting the next calendar period. The following data are provided for the current year: Labor: Direct Labor Cost P350,000 Indirect labor 35,000 Raw Materials: Inventory, Jan. 1 50,000 Purchases on Account 400,000 Issued to Production 380,000 Other factory overhead costs: Depreciation 110,000 Maintenance 50,000 Miscellaneous 31,000 Work in Process: Beg. Inventory 220,000 Ending Inventory 160,500 The company is planning to use a predetermined overhead rate based on direct labor hours. The planned rate for the year is P10.40 per direct labor hour. a. Give all the entries required, following the flow of cost. b. Determine the total factory costs under normal costing using P10.40 direct labor as cost driver. 2. Normal costing- Plant wide rate. Rocky tailoring has three departments: design, machine sewing and beading. The design department overhead consists of computers and software for computer-assisted design. The machine sewing dept. overhead consists of thread, sewing machines and small tools. The beading department has very little overhead, just thread and some glue and all departments are assigned a share of utilities, rent and others. Information on estimated overhead and direct labor hours for the year by department are as follows: Department Est. Overhead Est. DLH Design department P110,000.00 4,000 Sewing department P84,000.00 14,000 Beading department #6,000.00 2,000 Rocky Tailoring has just accepted a contract for fory new tutus for the nutcracker ballet. The costs are direct materials. P30,000; direct labor: 25hrs at P25 per hr of design works, 320 hours of sewing time at P15 per hr and 200 hours of beading at P20 per hr. Rocky Tailoring uses plant wide rate based on direct labor hours for overhead application and charges customers at cost plus 30%. Compute for: a. Pre-determined overhead rate b. Total overhead applied to the job C. Total cost of the job d. Billing price References: Cost Accounting and Control by Gloria A. Rante Cost Accounting and Control by Norma D. De Leon, Ellery D. De Leon and Guillermo M. De Leon, Jr