Problem 17: Income Statement MARK Inc. is engaged in the business of manufacturing basket balls. The company employs actual costing system. The company uses a single account for direct and indirect materials. The company provided the following data for the year ended December 31, 2016: 9,500,000 500,000 1,000,000 200,000 400,000 1,000,000 300,000 100,000 500,000 2,000,000 3,000,000 Gross sales Sales returns Gross purchases Purchase returns, allowance and discount Freight in Total costs of factory labor Depreciation of factory assets Expired insurance on factory assets Utilities expense on factory Total administrative expenses Total marketing expenses Inventories are as follows: December 31 300,000 200,000 600,000 January 1 100,000 Raw materials Work in process Finished goods 500,000 The following additional data are provided: 1. The net profit ratio of the company before income tax for the year ended December 31, 2016 was 10% of net sales. 2. The direct labor cost for the year was four times the cost of indirect labor. 3. The cost of indirect materials used was P100,000.

Problem 17: Income Statement MARK Inc. is engaged in the business of manufacturing basket balls. The company employs actual costing system. The company uses a single account for direct and indirect materials. The company provided the following data for the year ended December 31, 2016: 9,500,000 500,000 1,000,000 200,000 400,000 1,000,000 300,000 100,000 500,000 2,000,000 3,000,000 Gross sales Sales returns Gross purchases Purchase returns, allowance and discount Freight in Total costs of factory labor Depreciation of factory assets Expired insurance on factory assets Utilities expense on factory Total administrative expenses Total marketing expenses Inventories are as follows: December 31 300,000 200,000 600,000 January 1 100,000 Raw materials Work in process Finished goods 500,000 The following additional data are provided: 1. The net profit ratio of the company before income tax for the year ended December 31, 2016 was 10% of net sales. 2. The direct labor cost for the year was four times the cost of indirect labor. 3. The cost of indirect materials used was P100,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

How do you calculate costs of goods sold?
A cost - based transfer price considers the cost of producing the goods when determining the price. True False
How is the cost per equivalent unit of production calculated?
An example of qualitative data is 1.product price 2.production cos 3.product features 4.prime cost
In cost terms, direct labor cost is included inA. Manufacturing costsB. Prime costsC. Conversion costsD. B and CE. A, B and C
2. Distinguish between product costs and period costs. 6. What is the difference between gross margin and manufacturing margin?
The equation for total costs (Y) is: Y = a+ bX In this equation, “a” represents: Net income Cost of goods sold Total fixed costs The level of activity (e.g., the number of units produced) Total variable costs Variable cost per unit of X Total revenue
estion 2 Which of the following way of cost assignment used to assign accumulated cost with an indirect relationship to a cost object? Cost allocation Cost tracing Cost accumulation Cost assignment
Define the terms Cost Costing Cost Accounting Cost Accountancy Management Accounting Financial Accounting Product vs Period Cost Manufacturing vs Non-Manufacturing Direct vs Indirect Cost Opportunity cost Sunk cost Differential cost Prime cost Conversion Cost
Discuss the following methods used in measuring cost and rent recoveries (i) Joint cost allocation (ii) General principle of cost allocation (iii) Separable cost remaining benefits methods