Problem 1 The production and cost data for Garapon, Inc.
for the
Kolon Company makes a variety of clay pots in a single month of September is as follows:
department. Because clay is added at the start of
processing, all inventories are 100% complete as to this Units
material as soon as processing begins. Labor and Jars in beginning inventory (60% complete) 6,000
overhead are assumed to be at the same degree of Jars started during the current period 45,000
completion throughout the production process. Below Jars completed and transferred to finished
are production and cost information for the month of goods 39,600
April: Jars in ending inventory (75% complete) 7,500
Spoiled jars 3,900
Units
Costs
Clay pots in beginning inventory (40%
Costs of beginning inventory
complete as to labor and overhead or
Direct material P8,115
conversion) 1,000
Conversion costs 1,730 P9,845
Clay pots started during the current period 40,140
Current period costs
Clay pots completed and transferred to
finished goods 40,600 Direct material P50,873
Clay pots in ending inventory (80% Conversion costs 9,521 P60,394
complete as to labor and overhead or
conversion) 540 Required:
Prepare the cost of production report for the month.
Costs
Costs of beginning inventory Problem 3
Direct material P1,189 Bayong Company manufactures bayongs in a two-
Direct labor 360 department process. The first department uses weighted
Overhead 2,992 P4,541 average costing and the second department uses the
Current period costs FIFO method. The following production data and costs
Direct material P64,224 relate to the current month’s operations.
Direct labor 34,537
Overhead 97,517 P196,278
Department 1
Units
Required:
a. Prepare the cost of production report assuming Beginning work in process (100% complete
for material; 40% complete for labor; 30%
the company uses the weighted average method.
complete for overhead) 1,250
b. Prepare the cost of production report assuming Started during the current period 44,000
the company uses the FIFO method. Ending work in process (100% complete for
c. Prepare the journal entries under the FIFO material; 70% complete for labor; 90%
method to account for the current period’s complete for overhead) 2,000
production.
Costs
Problem 2 DM DL OH
Garapon, Inc. produces glass jars in a single department. Beginning inventory P18,775 P3,450 P1,250
All materials are added at the start of the process, and Current period 501,600 P318,030 138,405
conversion costs are applied uniformly throughout the
production process. Breakage commonly occurs after the
jars are formed when a machine pushes air into them to
form their openings. A maximum of 5% of the material
placed in production is expected to be lost during the
process. The company uses the weighted average
method to calculate its equivalent units.
Department 2
Units
Beginning work in process (100% complete
for transferred in; 15% complete for
material; 40% complete for conversion) 500
Transferred in 43,250
Ending work in process (100% complete for
transferred in; 30% complete for material;
65% complete for conversion) 1,000
Costs
DM DL OH
Beginning inventory P10,880 P150 P475
Current period 942,850 77,355 108,000
Required:
a. Prepare the cost of production report for
Department 1.
b. Prepare the cost of production report for
Department 2.
c. Prepare the journal entries for Department 2.
Problem 4
Lata Company manufactures aluminium cans in a single
department. The following production and cost
information were gathered for the current period:
Units
Beginning inventory (2/3 complete) 200
Completed during the period 6,900
Ending inventory (1/3 complete) 600
Costs
DM DL OH
Beginning inventory P100 P60 P40
Current period 7,000 4,200 2,800
Required:
Prepare the cost of production report for the current
period.
