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ye ompany also pays P4,000 a ye aborer are charged to the facte uring the 11 1/2 months the e Required: Compute th ne incurrence of lahor cost di

ye ompany also pays P4,000 a ye aborer are charged to the facte uring the 11 1/2 months the e Required: Compute th ne incurrence of lahor cost di

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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5. Mr. Combate, a factory laborer earns P18,000 per month, and the company pays one month salary as a bonus at the end of the year. Mr. Combate is entitled to a half month paid vacation leave. The company also pays P4,000 a year into a pension fund of the worker. All fringe benefits of factory laborer are charged to the factory overhead account. The fringe benefits are charged to production during the 11 1/2 months the employee is at work. Required: Compute the total liability for fringe benefits and prepare journal entries to record the incurrence of labor cost, distribution and fringe benefit liabilities.
Transcribed Image Text:5. Mr. Combate, a factory laborer earns P18,000 per month, and the company pays one month salary as a bonus at the end of the year. Mr. Combate is entitled to a half month paid vacation leave. The company also pays P4,000 a year into a pension fund of the worker. All fringe benefits of factory laborer are charged to the factory overhead account. The fringe benefits are charged to production during the 11 1/2 months the employee is at work. Required: Compute the total liability for fringe benefits and prepare journal entries to record the incurrence of labor cost, distribution and fringe benefit liabilities.
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