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At year-end, Frenzy Company had a fire which completely destroyed the goods in process inventory. A physical inventory was taken after the fire. December 31 January 1 Finished goods Goods in process Raw materials Factory supplies 6,000,000 4,300,000 1,700,000 500,000 During the year, the entity reported sales P20,000,000, purchases P3,800,000, freight P200,000, direct labor P5,000,000 and manufacturing overhead at 60% of direct 4,500,000 2,000,000 400,000 labor. The average gross profit rate is 30% on sales.

At year-end, Frenzy Company had a fire which completely destroyed the goods in process inventory. A physical inventory was taken after the fire. December 31 January 1 Finished goods Goods in process Raw materials Factory supplies 6,000,000 4,300,000 1,700,000 500,000 During the year, the entity reported sales P20,000,000, purchases P3,800,000, freight P200,000, direct labor P5,000,000 and manufacturing overhead at 60% of direct 4,500,000 2,000,000 400,000 labor. The average gross profit rate is 30% on sales.

FINANCIAL ACCOUNTING
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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destroyed the goods in process inventory. A physical Problem 13-13 (AICPA Adapted) At year-end, Frenzy Company had a fire which cormpletely inventory was taken after the fire. December 31 January 1 Finished goods Goods in process Raw materials Factory supplies 6,000,000 4,300,000 1,700,000 500,000 4,500,000 2,000,000 400,000 During the year, the entity reported sales P20,000,000, purchases P3,800,000, freight P200,000, direct labor P5,000,000 and manufacturing overhead at 60% of direct labor. The average gross profit rate is 30% on sales. 1. What is the cost of raw materials used? a. 5,700,000 b. 3,700,000 c. 3,800,000 d. 3,600,000 2. What is the total manufacturing cost? a. 13,000,000 b. 11,800,000 c. 11,700,000 d. 11,600,000 3. What is the cost of goods sold? a. 12,000,000 b. 16,000,000 c. 13,000,000 d. 14,000,000 4. What is the cost of goods in process inventory destroyed by fire? a. 3,500,000 b. 3,800,000 c. 2,500,000 d. 1,500,000 375
Transcribed Image Text:destroyed the goods in process inventory. A physical Problem 13-13 (AICPA Adapted) At year-end, Frenzy Company had a fire which cormpletely inventory was taken after the fire. December 31 January 1 Finished goods Goods in process Raw materials Factory supplies 6,000,000 4,300,000 1,700,000 500,000 4,500,000 2,000,000 400,000 During the year, the entity reported sales P20,000,000, purchases P3,800,000, freight P200,000, direct labor P5,000,000 and manufacturing overhead at 60% of direct labor. The average gross profit rate is 30% on sales. 1. What is the cost of raw materials used? a. 5,700,000 b. 3,700,000 c. 3,800,000 d. 3,600,000 2. What is the total manufacturing cost? a. 13,000,000 b. 11,800,000 c. 11,700,000 d. 11,600,000 3. What is the cost of goods sold? a. 12,000,000 b. 16,000,000 c. 13,000,000 d. 14,000,000 4. What is the cost of goods in process inventory destroyed by fire? a. 3,500,000 b. 3,800,000 c. 2,500,000 d. 1,500,000 375
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