Miracles Manufacturing Co. manufactures a lifting equipment. One order from Heaven Company for 3,000 lifting equipment showed the following cost per unit; materials P35.00; labor P20.00; FOH applied at 150% of direct labor cost which includes a 10% allowance for reworking defective units. Final inspection showed that 250 units were not properly produced. Correction for each defective unit requires P3.50 for materials, P4.00 for labor and FOH at the appropriate rate. Assuming the defective units are the result of internal failure, how much is the cost of goods manufactured?
Miracles Manufacturing Co. manufactures a lifting equipment. One order from Heaven Company for 3,000 lifting equipment showed the following cost per unit; materials P35.00; labor P20.00; FOH applied at 150% of direct labor cost which includes a 10% allowance for reworking defective units. Final inspection showed that 250 units were not properly produced. Correction for each defective unit requires P3.50 for materials, P4.00 for labor and FOH at the appropriate rate. Assuming the defective units are the result of internal failure, how much is the cost of goods manufactured?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Miracles Manufacturing Co. manufactures a lifting equipment. One order from Heaven
Company for 3,000 lifting equipment showed the following cost per unit; materials P35.00;
labor P20.00; FOH applied at 150% of direct labor cost which includes a 10% allowance for
reworking defective units. Final inspection showed that 250 units were not properly
produced. Correction for each defective unit requires P3.50 for materials, P4.00 for labor and
FOH at the appropriate rate.
Assuming the defective units are the result of internal failure, how much is the cost of
goods manufactured?
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