The cost accountant of Habagat Company was stricken with flu before the necessary manufacturing statements could be prepared at year end. You are appointed to take over this task of preparing the statement of cost of goods manufactured and income statement for the year ended December 31, 2019. The following data were submitted for this purpose.

a.Net income before taxes amounted to 1/3 of the operating expenses total.

b.Finished goods inventory on January 1 were 1.5 times more than the finished goods inventory at year end.

c.Goods were sold at a gross margin of 20% and the gross profit on sales made during the year showed P16,000.

d.Cost of goods manufactured were P4,000 less than the cost of goods sold during the year.

e.Total factory costs were 25% more than the costs of goods manufactured and are apportioned as follows:

Raw materials used

60%

Direct labor costs

30%

Factory overhead

10%

f.Purchases of raw materials were only 1/3 of the raw materials inventory at the start of the year and there were no returns made. Raw materials unused at year-end amounted to P35,000.

g.Goods in process were 4 times as much on hand at year-end than the start of the year.