Question

Problems Problem 1 (Flow of accounting for a manufacturing company) The following events took place at the Barton Manufacturing Corporation for the current year: 1. Purchased P80,000 in direct materials. 2. Incurred labor costs as follows: a. Direct labor, P42,000. b. Supervisory labor, P11,500 (part of manufacturing overhead). 3. Purchased manufacturing equipment for P67,200. 4. Other manufacturing overhead was P80,500, excluding supervisory labor. 5. Transferred 70 percent of the materials purchased to work in process. 6. Completed work on 60 percent of the goods in process. Costs are equally distributed across all work in process. 7. Sold 90 percent of the completed goods. There were no beginning balances in the inventory accounts. All costs incurred were debited to the appropriate account and credited to accounts payable. Required: 1. Prepare journal entries to reflect these events. 2. Prepare T-accounts to show these events. 3. Prepare a cost of goods sold statement from the data.

          Problems Problem 1 (Flow of accounting for a manufacturing company) The following events took place at the Barton Manufacturing Corporation for the current year:

    1. Purchased P80,000 in direct materials.
    2. Incurred labor costs as follows:
        a. Direct labor, P42,000.
        b. Supervisory labor, P11,500 (part of manufacturing overhead).
    3. Purchased manufacturing equipment for P67,200.
    4. Other manufacturing overhead was P80,500, excluding supervisory labor.
    5. Transferred 70 percent of the materials purchased to work in process.
    6. Completed work on 60 percent of the goods in process. Costs are equally distributed across all work in process.
    7. Sold 90 percent of the completed goods.

    There were no beginning balances in the inventory accounts. All costs incurred were debited to the appropriate account and credited to accounts payable.

    Required:
    1. Prepare journal entries to reflect these events.
    2. Prepare T-accounts to show these events.
    3. Prepare a cost of goods sold statement from the data.

Added by Jennifer B.

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