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