Reference no: EM132750217

Question - Lady Manufacturing Company had the following transactions:

Raw materials were purchased on account for P200,000

Materials were placed into production

Actual direct labor costs were P130,000

Actual overhead costs, P150,000

The raw materials purchased were immediately charged to Raw and In Process account while direct labor and actual overhead costs were charged to Cost of Sales. The inventories were as follows at the beginning and end of the period.

Raw and in process:

Beginning were P75,000 of which P45,000 is conversion costs

Ending were P50,000 of which P30,000 is conversion costs.

Finished goods:

Beginning were P80,000 of which P35,000 is conversion costs

Ending were P90,000 of which P30,000 is conversion costs.

Required - Journalize the above information using backflush accounting.