Reference no: EM132747049

The following transactions and account balances of MARCELO company are as follows:

Manufacturing cost of 1,000,000.00 ;

Conversion cost of 600,000.00 ;

Sales of 2,500,000.00;

Selling and admin expenses of 550,000.00 ;

Factory overhead control account of 235,000.00 ;

Overhead application rate per labor hour of PHP 6 per hour ;

Increase in Work in process account of 120,000.00 ;

Decrease in Finished Goods Inventory of 250,000.00 ;

Direct labor rate per hour of PHP 10 per hour.

Problem 1: Applied Overhead is equivalent to 60% of Direct labor cost. What is the COGS after adjustment of under/over applied overhead (O/U OH is immaterial)?