MahirapTo Company started in 2018, it produced 100,000 units from 2018 to 2020. The company had an ending inventory of 20,000 and 30,000 units in 2019 and 2020, respectively. The company always finishes its goods put into process and uses the high-low method of separating mixed costs. MahirapTo provided the following information pertaining to its manufacturing costs for 2020: Direct materials P 150,000 Direct labor 100,000 Indirect materials 40,000 Depreciation of manufacturing equipment 180,000 Rental expense on the warehouse 50,000 Utilities (Mixed costs) @ 40,000 kw/h 80,000 Other information are as follows: • Utilities incurred during 2019 were 78,000, at 38,000 kw/h usage. • There were no additional equipment purchased since the company started operations. • The company rented only one warehouse since its inception. • The unit cost under absorption costing for 2019 is P5.50. • The company uses the FIFO method of inventory measurement. • In 2018 all units produced were sold Question 1: How much is the total manufacturing cost under variable costing for 2020? Question 2: How much is the cost of goods sold under variable costing? (INSTRUCTIONS: DO NOT PUT COMMA or PESO SIGN ON YOUR ANSWERS)

MahirapTo Company started in 2018, it produced 100,000 units from 2018 to 2020. The company had an ending inventory of 20,000 and 30,000 units in 2019 and 2020, respectively. The company always finishes its goods put into process and uses the high-low method of separating mixed costs. MahirapTo provided the following information pertaining to its manufacturing costs for 2020: Direct materials P 150,000 Direct labor 100,000 Indirect materials 40,000 Depreciation of manufacturing equipment 180,000 Rental expense on the warehouse 50,000 Utilities (Mixed costs) @ 40,000 kw/h 80,000 Other information are as follows: • Utilities incurred during 2019 were 78,000, at 38,000 kw/h usage. • There were no additional equipment purchased since the company started operations. • The company rented only one warehouse since its inception. • The unit cost under absorption costing for 2019 is P5.50. • The company uses the FIFO method of inventory measurement. • In 2018 all units produced were sold Question 1: How much is the total manufacturing cost under variable costing for 2020? Question 2: How much is the cost of goods sold under variable costing? (INSTRUCTIONS: DO NOT PUT COMMA or PESO SIGN ON YOUR ANSWERS)

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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