4. Katherine, owner of KCO Supply Company in Cebu, which manufactures Chopsticks for restaurants, has recently decided to implement a Just-in-Time Costing system. Transactions for August are as follows: a. Raw materials were purchased at the cost of P950,000. b. All materials purchased were requisitioned for production. c. Direct labor costs of P2,500,000 were incurred. d. Actual factory overhead costs amounted to P6,000,000. e. Applied conversion costs totaled P8,100,000. This included P2,500,000 of direct labor. f. All units were competed What is the over-allocated or under-allocated conversion costs for the month? a. P1,350,000 under-allocated b. P2,100,000 under-allocated c. P 400,000 under-allocated d. P 400,000 over-allocated
4. Katherine, owner of KCO Supply Company in Cebu, which manufactures Chopsticks for restaurants, has recently decided to implement a Just-in-Time Costing system. Transactions for August are as follows: a. Raw materials were purchased at the cost of P950,000. b. All materials purchased were requisitioned for production. c. Direct labor costs of P2,500,000 were incurred. d. Actual factory overhead costs amounted to P6,000,000. e. Applied conversion costs totaled P8,100,000. This included P2,500,000 of direct labor. f. All units were competed What is the over-allocated or under-allocated conversion costs for the month? a. P1,350,000 under-allocated b. P2,100,000 under-allocated c. P 400,000 under-allocated d. P 400,000 over-allocated
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:4. Katherine, owner of KCO Supply Company in Cebu, which manufactures Chopsticks for restaurants,
has recently decided to implement a Just-in-Time Costing system. Transactions for August are as
follows:
a. Raw materials were purchased at the cost of P950,000.
b. All materials purchased were requisitioned for production.
c. Direct labor costs of P2,500,000 were incurred.
d. Actual factory overhead costs amounted to P6,000,000.
e. Applied conversion costs totaled P8,100,000. This included P2,500,000 of direct labor.
f. All units were competed
What is the over-allocated or under-allocated conversion costs for the month?
a. P1,350,000 under-allocated
b. P2,100,000 under-allocated
c. P 400,000 under-allocated
d. P 400,000 over-allocated
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