PROBLEM 5 INCOME STATEMENT OF A MANUFACTURING COMPANY

The beginning balances of Luke Steel Manufacturing Company is presented as follows:

Beginning Balances Ending Balances

Raw Materials P 400,000 P 350,000

Work In Process 500,000 420,000

Finished Goods 700,000 600,000

Transactions that transpired during the month were:

1. Raw materials amounting to P40,000 were purchased in cash.

2. Purchase Raw Materials costing P100,000 on account.

3. Rental during the period: 50% Office; 50% Factory, amount, P150.000

4. Depreciation Expense: P15,000 Office Equipment; P25,000 Machineries and Equipment

5. Utilities incurred P25,000

6. Paid Office Salaries, P10,000

7. Indirect Materials used P50,000

8. Factory labor used consisted of: Direct Labor P 270,000 Indirect Labor 100,000

9. Finished goods sold amounts to P 1,520,000 10. Office supplies expenses, P2,500

A. Compute for the following: (10 pts)

1. Raw Materials used

2. Manufacturing cost

3. Cost of Goods Manufactured

4. Cost of Goods Sold

5. Gross Profit

B. Prepare the Income Statement of Luke Steel Manufacturing Company for the first quarter of 2020.( prepare schedule)