Chapter $4$ Job Order Costing

Job $401$ was shipped and billed at a gross profit of $40\%$ of the cost.

Cash collections from accounts receivable during August were p$87\mathrm{.}500.$

Journal entries to record the above transactions.

job order cost sheets.

Cost of goods sold statement.

Problem $2$

On December $31,2022,$ after closing, the ledgers of Solidarity Company contained

these accounts and balances:

Cash

Accounts Receivable

Finished Goods

Work in Process

Materials

Machinery

Accounts Payable

Common Stock

Retained Earnings

Details of the three inventories are:

Finished goods inventory:

Item $A-2,000$ units at $12\mathrm{.}50$

Item B $-4,000$ units at $P10\mathrm{.}00$

Total

Work in process inventory:

Job $101$

P $94,000$

$100,000$

$65,000$

$15,000$

$70,600$

$118,750$

$200,00069,850$

Direct materials:

$1,$ OOO units at $P5\mathrm{.}00$

P $5,000$

$400$ units at $P3\mathrm{.}00$

Direct labor:

$1,$ OOO hours at P $4\mathrm{.}00$

$400$ hours at $P5\mathrm{.}00$

Factory overhead:

Applied at $P\frac{2\mathrm{.}00}{?}$ hour $\frac{2,000}{P11,000}$

Total

$\backslash$table$[[4,000,2,000],[2,000,$P $4,000],[1,000,]]$

Materials inventory:

Material $x-4,00$O units at $P5\mathrm{.}00$

Material $Y-8,000$ units at $P3\mathrm{.}00$

Total

$128$

During January, $2022,$ these transactions were completed:

units at P $3\mathrm{.}75$; indirect materials $-$ P$35,040.$

b$)$ Payroll totaling P$220,000$ was paid. Of the total payroll, P$40,000$ was for

marketing and administrative salaries. Payroll deductions consisted of P$31,000$

for withholding taxes, P$7,000$ for SSS premiums, P $440$ for Medicare

contributions, P $6,600$ for Pag$-$ibig Funds. Payroll is to be distributed as follows:

c$)$ Payroll Job $102-16,000$ direct labor hol $-10,000$ direct labor hours at $P$

$4\mathrm{.}00,$ Job $102-16,000$ direct labor hours at P$5\mathrm{.}00$; Job $103-12,000$ direct labor hours at P$3\mathrm{.}00$; indirect labor P$2$

salaries $-$ P$40,000.$ Employer's

Medicare contributions $-0\mathrm{.}2\%$; and Pagroll taxes are: SSS Premiums $-5\%.$

d$)$ Materials were issued on a FIFO basis as follows $-3\%.$

$($charged to Job $101)$; Material Y $-24,000$ units $($charged

X $-2,000$ units and Materials Y $-5,000$ units $($charged to Job $103)$; Material

Transactions are to be taken in consecutive order$).$ Indirect materiat

amounted to P$15,040.$

e$)$ Factory overhead was applied to Jobs $101,102,$ and $103$ based on a rate of

P$2\mathrm{.}25$ per direct labor hour.

f$)$ Jobs $101$ and $102$ were completed and sold on account for P$240,000$ and

P$270,000,$ respectively.

g$)$ After allowing a $5\%$ cash discount, a net amount of P$494,000$ was collected on

accounts receivable.

h$)$ Marketing and administrative expenses $($other than salaries$)$ paid during the

month amounted to P$30,000.$ Miscellaneous factory overhead of P$21,600$ was

paid. Depreciation on machinery was $P4,000.$

i$)$ Payments on account, other than payroll paid, amounted to P$170,000.$

j$)$ The over or under$-$applied factory overhead is to be closed.

Required:

Open T$-$accounts and record balances from the January $1$ trial balance.

Journalize the January transactions.

Post January transactions to the general ledger, and subsidiary ledgers for

materials and work in process.

Prepare a statement of cost of goods sold