2. On November 1, a fire destroyed the work in process inventories of Kenshin Inc. After the fire a physical inventory was taken. January 1 P600,000 November 1 Direct raw materials P400,000 Factory supplies Work in process Finished goods 80,000 50,000 ??? 300,000 500,000 900,000 For the 10 months ended October 31, Kenshin reported the following: P10,000,000 Direct labor (DL) 40,000 Manufacturing overhead 80,000 Gross profit rate Sales 4,000,000 Accounts payable, Jan. 1 Accounts payable, Oct. 31 40% of DL 35% Pavment for purchases 500 .000
2. On November 1, a fire destroyed the work in process inventories of Kenshin Inc. After the fire a physical inventory was taken. January 1 P600,000 November 1 Direct raw materials P400,000 Factory supplies Work in process Finished goods 80,000 50,000 ??? 300,000 500,000 900,000 For the 10 months ended October 31, Kenshin reported the following: P10,000,000 Direct labor (DL) 40,000 Manufacturing overhead 80,000 Gross profit rate Sales 4,000,000 Accounts payable, Jan. 1 Accounts payable, Oct. 31 40% of DL 35% Pavment for purchases 500 .000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question:
1. The amount of work in process inventory that was destroyed by fire amounted to
a. P510,000
b. P140,000
c. P460,000
d. P540,000
Transcribed Image Text:2. On November 1, a fire destroyed the work in process inventories of Kenshin Inc. After the fire a
physical inventory was taken.
November 1
January 1
P600,000
50,000
Direct raw materials
P400,000
Factory supplies
Work in process
Finished goods
80,000
???
300,000
500,000
900,000
For the 10 months ended October 31, Kenshin reported the following:
P10,000,000 Direct labor (DL)
40,000 Manufacturing overhead
80,000 Gross profit rate
Sales
4,000,000
Accounts payable, Jan. 1
Accounts payable, Oct. 31
Payment for purchases
40% of DL
35%
500,000
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