At the end of the reporting period, Pinky Corp. shows the following account for machinery it had assembled for its own use during the period: Cash paid for equipment, including VAT of P9,600 89,600 1,500 Insurance costs for current year Cost of dismantling old machine 14,480 Cash proceeds from sale of old machine 12,000 Raw materials used in construction of new machine 76,000 Labor on construction of new machine 49,000 Cost of installation 11,200 Costs of water devices to keep machine cool 8,000 Materials spoiled in machine trial runs 2,400 Profit on construction 24,000 Purchase of machine tools 13,000 Costs of adjustments to machine to make it operate more efficiently 7,500 An analysis of the details in the account disclosed the following: a. Cash discounts received on the payments for materials used in construction totaled P3,000, and these were reported in the purchase discounts account. b. The factory overhead account shows a balance of P292,000 for the current period; this balance exceeds normal overhead on regular plant activities by approximately P16,900 and is attributable to machine construction. What is the adjusted cost of machinery?

At the end of the reporting period, Pinky Corp. shows the following account for machinery it had assembled for its own use during the period: Cash paid for equipment, including VAT of P9,600 89,600 1,500 Insurance costs for current year Cost of dismantling old machine 14,480 Cash proceeds from sale of old machine 12,000 Raw materials used in construction of new machine 76,000 Labor on construction of new machine 49,000 Cost of installation 11,200 Costs of water devices to keep machine cool 8,000 Materials spoiled in machine trial runs 2,400 Profit on construction 24,000 Purchase of machine tools 13,000 Costs of adjustments to machine to make it operate more efficiently 7,500 An analysis of the details in the account disclosed the following: a. Cash discounts received on the payments for materials used in construction totaled P3,000, and these were reported in the purchase discounts account. b. The factory overhead account shows a balance of P292,000 for the current period; this balance exceeds normal overhead on regular plant activities by approximately P16,900 and is attributable to machine construction. What is the adjusted cost of machinery?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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