Topic: Average and FIFO Costing

Chapter 11 Average and FIFO Costing Problem 14 347 The following were taken from the books of Michelle Company for the month of June, 2019. The company uses FIFO in costing finished goods and goods sold Inventories, June 1 Materials P 50,000 Finished goods ( 5,000 units) 75,000 The transactions for the month of June are as follows: 1. Purchased materials on account, P 180,000 2. Issued materials - Dept. 1 P 90,000, Dept. 2 - P112,500 3. The total payroll for the month amounted to P 135,600 distributed as follows: Dept. 1-P 64,800, Dept. 2-P 61,600 and the balance - indirect labor 4. Factory overhead applied amounted to Dept 1 - P 59,400; Dept. 2 - P 50,600 5. Units completed and transferred to finished goods - 40,000 6. Sold 25,000 units at P 400,000 QUANTITY DATA DEPT. 1 DEPT. 2 Units started 60,000 45,000 40,000 Units completed 60% 80% Stage of completion Materials, in both departments, are added 100% at the beginning Requirements: 1. Journal entries to record the above transactions 2. Cost of units completed and transferred - Dept. 1 3. Cost of units completed and transferred - Dept. 2 4. Cost of goods sold statement