Problem 7

In June 2020, the Graves Company has Cost of Goods Manufactured of P296,000; beginning Finished Goods Inventory of P29,730; and ending Finished Goods Inventory of P19,990. The following additional information is available:

Selling Expenses	P 40,500
Administrative Expenses	19,700
Sales	475,600

Required:Prepare an income statement in good form.

Problem 8

Instruction: Determine whether each of the following costs should be classified as direct materials (DM), direct labor (DL), or factory overhead (FOH).

1. Depreciation on factory equipment
2. Wages paid to assembly line workers
3. Factory rent
4. Depreciation of pencil painting machinery
5. Lead inserted into pencils
6. Wages of assembly line worker
7. Factory machinery maintenance
8. Wood used to manufacture furniture
9. Eraser compound
10. Steel used in manufacturing product.
11. Insurance on factory building.
12. Rivets and screws used in production.
13. Tires used in manufacturing vehicles.
14. Nails and glue used in production
15. Cabinet maker's wages
16. Factory supervisors' salaries
17. Depreciation on factory machines
18. Factory utilities
19. Property taxes on the factory building

Insurance on factory equipment