Reliance Company budgets sales at P2,000,000 and expects a net

income before tax of 10% of the sales. Expenses are estimated as follows:

Selling 15% of sales

Administrative 9% of sales

Finance 1% of sales

Labor is expected to be 40% of the total manufacturing cost. Factory overhead is to

be applied at 75% of direct labor cost. Inventories are to be as follows:

January 1 December 31

Materials 250,000 300,000

Work in process 200,000 320,000

Finished goods 350,000 400,000

Required: Compute the following:

1. Total Manufacturing Costs.

2. Factory overhead.

3. Materials Purchases.