ABC Company has the following transactions: During September 2013, material requisition forms L-40-L55 indicated that raw materials costing P5,420 were issued from the warehouse to the Fabrication Department. This Raw Material Inventory account may include the costs of both direct and indirect materials. When material is used, its cost is released from the Raw Material Inventory. If the material is considered direct to a job, the cost is assigned to WIP inventory; if the material is indirect, the cost is assigned to Manufacturing Overhead Control. The raw material requisitioned in September included P4,875 of direct materials used on Job #PF108 and P520 of direct materials used on other jobs. The remaining P25 raw materials issued during September were indirect. The September time sheets and payroll summaries for the Fabrication Department workers were used to trace direct and indirect labor to that department. Total labor cost for the Fabrication Department for September was P9,599. Job #PF108 required P6,902 of direct labor cost combining the two biweekly pay periods in September. The remaining jobs in process required P1,447 of direct labor cost, and indirect labor cost for the month totaled P1,250. The Fabrication Department incurred overhead costs in addition to indirect material and indirect labor during September. Factory building and equipment depreciation of P2,500 was recorded. Insurance on the factory building was prepaid and one month (P200) of that insurance had expired. A P1,900 bill for factory utility costs was received and would be paid in October. Repair and maintenance costs of P500 were paid in cash. Additional miscellaneous OH costs of P800 were incurred; these costs are credited to “Various accounts”. Crown prepares financial statements monthly. To do so, WIP inventory must include all production costs: DM, DL, and OH. Overhead is applied to production at Crown Fence Company based on departmental predetermined OH rates. The company is organized into three departments: Fabrication, Installation, and Finishing. Each department may have more than one rate. In Fabrication, overhead is applied using two pre-determined OH rates: P12 per direct labor hour and P30 per machine hour. In September, Fabrication employees committed 260 hours of direct labor time to Job #PF108, and 65 machine hours were consumed on that job. The other jobs worked on during September were committed with 25 direct labor hours and 20 machine hours. Provide the necessary journal entries.

ABC Company has the following transactions: During September 2013, material requisition forms L-40-L55 indicated that raw materials costing P5,420 were issued from the warehouse to the Fabrication Department. This Raw Material Inventory account may include the costs of both direct and indirect materials. When material is used, its cost is released from the Raw Material Inventory. If the material is considered direct to a job, the cost is assigned to WIP inventory; if the material is indirect, the cost is assigned to Manufacturing Overhead Control. The raw material requisitioned in September included P4,875 of direct materials used on Job #PF108 and P520 of direct materials used on other jobs. The remaining P25 raw materials issued during September were indirect. The September time sheets and payroll summaries for the Fabrication Department workers were used to trace direct and indirect labor to that department. Total labor cost for the Fabrication Department for September was P9,599. Job #PF108 required P6,902 of direct labor cost combining the two biweekly pay periods in September. The remaining jobs in process required P1,447 of direct labor cost, and indirect labor cost for the month totaled P1,250. The Fabrication Department incurred overhead costs in addition to indirect material and indirect labor during September. Factory building and equipment depreciation of P2,500 was recorded. Insurance on the factory building was prepaid and one month (P200) of that insurance had expired. A P1,900 bill for factory utility costs was received and would be paid in October. Repair and maintenance costs of P500 were paid in cash. Additional miscellaneous OH costs of P800 were incurred; these costs are credited to “Various accounts”. Crown prepares financial statements monthly. To do so, WIP inventory must include all production costs: DM, DL, and OH. Overhead is applied to production at Crown Fence Company based on departmental predetermined OH rates. The company is organized into three departments: Fabrication, Installation, and Finishing. Each department may have more than one rate. In Fabrication, overhead is applied using two pre-determined OH rates: P12 per direct labor hour and P30 per machine hour. In September, Fabrication employees committed 260 hours of direct labor time to Job #PF108, and 65 machine hours were consumed on that job. The other jobs worked on during September were committed with 25 direct labor hours and 20 machine hours. Provide the necessary journal entries.

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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ABC Company has the following transactions:

During September 2013, material requisition forms L-40-L55 indicated that raw materials costing P5,420 were issued from the warehouse to the Fabrication Department. This Raw Material Inventory account may include the costs of both direct and indirect materials. When material is used, its cost is released from the Raw Material Inventory. If the material is considered direct to a job, the cost is assigned to WIP inventory; if the material is indirect, the cost is assigned to Manufacturing Overhead Control. The raw material requisitioned in September included P4,875 of direct materials used on Job #PF108 and P520 of direct materials used on other jobs. The remaining P25 raw materials issued during September were indirect.
The September time sheets and payroll summaries for the Fabrication Department workers were used to trace direct and indirect labor to that department. Total labor cost for the Fabrication Department for September was P9,599. Job #PF108 required P6,902 of direct labor cost combining the two biweekly pay periods in September. The remaining jobs in process required P1,447 of direct labor cost, and indirect labor cost for the month totaled P1,250.
The Fabrication Department incurred overhead costs in addition to indirect material and indirect labor during September. Factory building and equipment depreciation of P2,500 was recorded. Insurance on the factory building was prepaid and one month (P200) of that insurance had expired. A P1,900 bill for factory utility costs was received and would be paid in October. Repair and maintenance costs of P500 were paid in cash. Additional miscellaneous OH costs of P800 were incurred; these costs are credited to “Various accounts”.
Crown prepares financial statements monthly. To do so, WIP inventory must include all production costs: DM, DL, and OH. Overhead is applied to production at Crown Fence Company based on departmental predetermined OH rates. The company is organized into three departments: Fabrication, Installation, and Finishing. Each department may have more than one rate. In Fabrication, overhead is applied using two pre-determined OH rates: P12 per direct labor hour and P30 per machine hour. In September, Fabrication employees committed 260 hours of direct labor time to Job #PF108, and 65 machine hours were consumed on that job. The other jobs worked on during September were committed with 25 direct labor hours and 20 machine hours.

Provide the necessary journal entries.

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