Determine the total manufacturing costs and factory overhead

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A Company has budgeted sales at P100,000 and expect a profit of 20% of the sales. Expenses are estimated as follows: selling = 10% of sales; administrative = 10% of sales. Labor is expected to be 50% of the total manufacturing costs. Factory overhead is to be applied at 75% of direct labor costs.

Inventories are to be as follows:

January 1 December 31

Materials P12,000 P4,000

Work-in-process 3,000 8,000

Finished goods 5,000 10,000

Required:

Problem 1: Determine the following:

a. Cost of goods sold

b. Total manufacturing costs

c. Factory overhead

Reference no: EM132715582

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