How much is the cost of goods manufactured? JR Company uses the normal cost system. The company applies overhead using a predetermined overhead rate using machine hours. At the beginning of the year, the company estimated that it would work 44,000 machine hours and incur P176,000 in factory overhead costs. Following are transactions for the month of February. [a] Purchased raw materials from CZ company, P555,000. Terms 2/10,n/60. [b] Materials were requisitioned for production, P431,000 direct and 13,000 indirect. [c] Returned materials to CZ company, P5,000 (gross) on the 3rd day after purchase. [d] Paid payroll for the week: Earnings Tax SSS PHIC Direct P220,000 24,000 13,480 5,000 Indirect 40,000 2,000 1,160 800 Selling 50,000 5,000 2,500 1,230 Admin 70,000 13,000 6,850 2,430 [e] Depreciation of factory machine is P119,000 [f] Factory utilities costs incurred, P24,000. [g] Overhead was applied to production using 47,000 hours. [h] P700,000 worth of goods were completed. [i] Paid utilities. [ij] Sold 75% of completed goods at 60% above cost.