Prepare the appropriate journal entry for each

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Reference no: EM132830475

Question - Ali Company is a manufacturing firm that uses job-order costing. At the beginning of the year, the company's inventory balances were as follows:

Raw materials Php36,000

Work in process Php41,000

Finished goods Php104,000

The company applies overhead to jobs using a predetermined overhead rate based on machine- hours. At the beginning of the year, the company estimated that it would work 21,000 machine-hours and incur Php210,000 in manufacturing overhead cost. The following transactions were recorded for the year:

a. Raw materials were purchased, Php346,000.

b. Raw materials were requisitioned for use in production, Php338,000 (Php302,000 direct and Php36,000 indirect).

c. The following employee costs were incurred: direct labor, Php360,000; indirect labor, Php68,000; and administrative salaries, Php111,000.

d. Selling costs, Php153,000.

e. Factory utility costs, Php29,000.

f. Depreciation for the year was Php102,000 of which Php93,000 is related to factory operations and Php9,000 is related to selling and administrative activities.

g. Manufacturing overhead was applied to jobs. The actual level of activity for the year was 19,000 machine-hours.

h. The cost of goods manufactured for the year was Php870,000.

i. Sales for the year totaled Php1,221,000 and the costs on the job cost sheets of the goods that were sold totaled Php855,000.

j. The balance in the Manufacturing Overhead account was closed out to Cost of Goods Sold.

Required - Prepare the appropriate journal entry for each of the items above (a. through j.). You can assume that all transactions with employees, customers, and suppliers were conducted in cash.

Reference no: EM132830475

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