BETTERED Engine Corporation manufactures a single model of gasoline engine used in lawn mowers, portable generators and pumps. The basic engine block is cast from steel and machined in the Casting Department. Then it is transferred to the Assembly Department, where the crank shaft, valves and other component parts are added. After assembly, it is transferred to the finishing department where the engine is tested. Data related to February operations are: Quantity data WIP, beg Stage of Completion Transferred to next 2,700 Assembly 1,000 Casting 500 Finishing 300 25% 50% 50% 2,900 2,800

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Chapter1: Financial Statements And Business Decisions
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Please show your computations through excel.

d. Using AVERAGE method, compute for the cost of goods sold assuming there was no beginning or ending inventory of finished goods for the month.

BETTERED Engine Corporation manufactures a single model of gasoline engine used in lawn mowers,
portable generators and pumps. The basic engine block is cast from steel and machined in the Casting
Department. Then it is transferred to the Assembly Department, where the crank shaft, valves and other
component parts are added. After assembly, it is transferred to the finishing department where the engine
is tested. Data related to February operations are:
Quantity data
WIP, beg
Stage of Completion
Casting
Assembly
1,000
Finishing
500
300
50%
2,800
25%
50%
Transferred to
next 2,700
2,900
department
WIP, end
Stage of Completion
800
800
400
90%
40%
50%
Cost data
Cost from preceding
department
Materials
Direct labor
FOH
Factory costs
Materials
Ро3,150
P42,840
P10,925
P338
P40,258
P12,426
P12,426
P2,760
P2,839
P4,140
P116,480
Direct labor
FOH
P146,575
P16,362
P48,461
P44,408
P12,240
P44,408
P18,360
a. Using FIFO, compute for the equivalent unit for finishing department.
b. Using FIFO, compute for the total cost of units transferred out from Finishing Department.
s. Using AVERAGE method, compute for the equivalent unit for casting department.
d. Using AVERAGE method, compute for the cost of goods sold assuming there was no beginning or
ending inventory of finished goods for the month.
Transcribed Image Text:BETTERED Engine Corporation manufactures a single model of gasoline engine used in lawn mowers, portable generators and pumps. The basic engine block is cast from steel and machined in the Casting Department. Then it is transferred to the Assembly Department, where the crank shaft, valves and other component parts are added. After assembly, it is transferred to the finishing department where the engine is tested. Data related to February operations are: Quantity data WIP, beg Stage of Completion Casting Assembly 1,000 Finishing 500 300 50% 2,800 25% 50% Transferred to next 2,700 2,900 department WIP, end Stage of Completion 800 800 400 90% 40% 50% Cost data Cost from preceding department Materials Direct labor FOH Factory costs Materials Ро3,150 P42,840 P10,925 P338 P40,258 P12,426 P12,426 P2,760 P2,839 P4,140 P116,480 Direct labor FOH P146,575 P16,362 P48,461 P44,408 P12,240 P44,408 P18,360 a. Using FIFO, compute for the equivalent unit for finishing department. b. Using FIFO, compute for the total cost of units transferred out from Finishing Department. s. Using AVERAGE method, compute for the equivalent unit for casting department. d. Using AVERAGE method, compute for the cost of goods sold assuming there was no beginning or ending inventory of finished goods for the month.
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