1. W Co. has underapplied overhead of P45,000 for the year.

Before disposition of the underapplied overhead,

selected year-end balances from W’s accounting records were
Sales P 1,200,000
Cost of goods sold 720,000
Direct materials inventory 36,000
Work in process inventory 54,000
Finished goods inventory 90,000
Under W’s cost accounting system, over-under applied overhead is allocated to appropriate inventories and
COGS based on year-end balances in its year-end income statement. W should report COGS of?
2. H Co. manufactures aviation control panels in two departments, Fabrication and Assembly. In the
Fabrication department. H uses a predetermined overhead rat of P30 per machine-hour. In the Assembly
department. H uses a predetermined overhead rate of P12 per direct labor hour. During the current year. Job
X29 incurred the following number of hours in each department:
Fabrication Assembly
Machine hours 40 12
Direct labor hours 3 25
What is the total amount of manufacturing overhead than H should have applied for Job X29 during the
current year?
3. F Co. uses a predetermined overhead rate based on direct labor hours to apply manufacturing overhead to
jobs. At the beginning of the period, the company estimated manufacturing overhead would be P18,000 and
direct labor hours would be 15,000. The actual figures were P19,500 for manufacturing overhead and 16,000
direct labor hours. The cost records for the period will show.
4. At the beginning of the year, manufacturing overhead for the year was estimated to be P250,860. At the end
of the year, actual direct labor hours for the year were 20,800 hours, the actual manufacturing overhead for
the year was P245,860, and manufacturing overhead for the year was underapplied by P10,820. If the
predetermined overhead rate is based on direct labor hours, then the estimated direct labor hours at the
beginning of the year used in the predetermined overhead rate must have been?
5. B Co. uses direct labor hours in its predetermined overhead rate. At the beginning of the year, the estimated
direct labor hours were 19,700 hours. At the end of the year, actual direct labor hours for the year were 17,700
hours, the actual manufacturing overhead for the year was P392,940, and manufacturing overhead for the
year was underapplied by P35,400. The estimated manufacturing overhead at the beginning of the year used
in the predetermined overhead rate must have been?

6. A Co. manufactures pipes and uses a job order costing system. During May, the following jobs were started
and the following cost were incurred:
Job X Job Y Job Z Total
Materials
Requisitioned P 10,000 20,000 15,000 P45,000
Direct labor 5,000 4,000 2,500 11,500
P 15,000 P24,000 P17,500 P56,500
In addition, estimated overhead of P300,000 and direct labor costs of P150,000 were estimated to be incurred
during the year. Actual overhead of P24,000 was incurred in May: overhead is applied on the basis of direct
labor pesos. If only JobX and Job Z were completed during the month, the appropriate entry to record the
initiation of all jobs would be?

7. The P Co. uses a raw and in process (RIP) inventory account and expenses all conversion costs to the cost of
goods sold account. At the end of each month, all inventories are counted, their conversion cost components
are estimated, and inventory account balances are adjusted accordingly. Raw materials cost is backflushed
from RIP to Finished Goods. The following information is for the month of April
Beg. Balances of RIP, including P1,400 at conversion cost P12,300
Raw materials received on credit 367,000
Ending RIP inventory per physical count, including P1,800
conversion cost estimate 33,000

Compute the amount to be backflushed from RIP to finished goods

8. The B Co. produces only for customer order and most work is shipped within 36 hours of the receipt of an
order. B Co uses a raw and in process inventory account and expenses all conversion costs to the cost of
goods sold account. At the end of each month, inventory is counted, its conversion cost component is
eliminated, and the RIP account balance is adjusted accordingly. Raw material cost is backflushed from RIP
to cost of goods sold. The following information is for the month of May:
Beginning balance of RIP account, including P1,300
At conversion cost… P 12,300
Raw materials received on credit 246,000
Ending RIP inventory per physical count including
P2,100 conversion cost estimate 12,100
Ending RIP inventory per physical count, including P2,100
conversion cost estimate 12,100
Compute the amount to be backflushed from RIP to Cost of goods sold
and compute the amount of Cost of goods sold after all transaction and adjustments were made