Journal, Cost Sheet and Income Statement Problem-1 (Matz and Usry-32) !

"#-1$ Following transactions pertain to manufacturing operations: a. Materials were issued as follows: direct Tk. 24,500; indirect 4,500. b. pa!roll of Tk. 44,000 was recorded. "ncome ta# wit$$eld, Tk. %,000; F"& ta# rate %'. c. T$e pa!roll consisted of Tk. (0,000 direct labor , Tk. ),000 indirect factor! labor, and *,000 sales salaries. +tate unemplo!ment insurance is 5.4', and federal is 0.*'. T$e emplo!er,s F"& ta# rate was %'. d. Miscellaneous factor! e#penses incurred will re-uire a cas$ e#penditure of Tk. %,500, ./o not 0ournali1e t$e cas$ pa!ment.2 e. Factor! o3er$ead of Tk. 45,000 was c$arged to production. f. &ost of production completed during t$e period totaled Tk. )0,000. g. Material purc$ased totaled Tk. 50,000. $. 5oods costing Tk. 20,000 were s$ipped to customers at a sales price of Tk. 2),000. 6e-uired: 7repare 0ournal entries for t$e abo3e transactions. Problem-2 (Matz and Usry-33) !"#-2$ &ost of goods manufactured statement. Mason &ompan! manufactures special mac$ines made to customer specifications. T$e following information was a3ailable at t$e beginning of 8ctober: Materials in3entor!999999.. Tk. 4)2,000 :ork in 7rocess in3entor!999.. Tk. ()00 /uring 8ctober, direct materials costing Tk.20,000 were purc$ased, direct labor cost totaled Tk. 4),500, and factor! o3er$ead was Tk. *5*0. 8ctober (4 in3entories were: Material "n3entor!9999999 Tk.4%,000 :ork in process in3entor!9999 Tk.*420 6e-uired 7repare a cost of goods manufactured statement for 8ctober, 4; Problem-3 !"#-3, Matz and Usry-33$ Manufacturing costs; cost of goods sold. T$e /ecember (4, 4;< trial balance of Menges &ompan! s$owed:

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+ales 99999 7urc$ase .=et29. Transportation in9 /irect labor 99.. +ales salaries 99 "n3entories: Finis$ed 5oods :ork in 7rocess Materials

Tk.44000500 Tk. 2400000 Tk. (2000 Tk. (204000 Tk. 200000

+ales return and allowance 9Tk. 25200 Factor! o3er$ead 99.. Tk. 4**5)00 d3ertising 9999.. Tk. 455000 /eli3er! e#penses99. Tk. )5,000 /ecember (4, 4; Tk. )20000 Tk. 42;*00 Tk. 4%)000

/ecember (4, 4;< Tk. 4)%400 Tk. 4()*00 Tk. 4;)000

6e-uired: /etermine t$e .42 total manufacturing cost, .22 cost of goods manufactured and t$e .(2 cost of goods sold. Problem % e"-%, Matz and Usry-33$ T$e accounting department of Mic$aelson &ompan! pro3ided t$e following data for Ma! sales Tk. %2,000; marketing e#penses Tk. (,)00; administrati3e e#penses Tk. %20, ot$er e#penses Tk. ()0; purc$ases Tk. (),000; factor! o3er$ead Tk. 40,000 direct labor Tk. 45,000. "n3entories Finis$ed goods :ork in process Materials 99999999999.. 99999999999.. 99999999999.. <eginning Tk. %,000 Tk. *,000 Tk. *,000 >nding Tk. 40,250 Tk. 45,000 Tk. *,500

6e-uired: i. +tatement of cost of goods sold ii. "ncome statement Problem& ' ()-2$ *+ ,td, a manu-actur.n/ com0any, .ncurred the -ollo1.n/ e"0enses dur.n/ a certa.n 0er.od# 2ou are re3u.red to 0re0are a statement sho1.n/ the subd.4.s.on ototal cost# 4,20,54 /epreciation of Materials used in 0obs 0 plant (,*00 /epreciation of deli3er! :ages traceable to 0ob *),)50 3ans 4,)00 :ages paid to man on maintenance "nsurance of finis$ed 42,)00 work goods 2,500 Factor! rent or rates *,(00 ?ubricating oil 250 &arriage outwards 2,*00 <ad debts (00 /irectors fee 40,000 &ommission to salesmen 2,*50 &ost of ideal time in uditors fee (,*00 factor! 540 @ire of crane for 0ob no. 4,(00 uditors fee (,*00

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4(2 +alesmenAs salaries &arriage inwards on raw materials :ork salaries &onsumable stores

45,400 *)0 20,400 (40

/i3idends paid ?ig$ting of s$owroom 8ffice salaries and e#penses "ncome ta#

),*00 4,500 %,000 *,)00

Problem& 5 ()-3$ 6he accounts o- P#+ Manu-acturers ,td, -or the year end.n/ on 31st )ecember, 177', sho1 the -ollo1.n/& +tock of materials on (4st Banuar!, 4;;5 )%,200 Materials purc$ased 2,5;,000 <ad debts written off ;,400 Tra3ellarAs salaries and commission 40,%*0 /epreciation written off on office furniture 420 6ent, rates, ta#es and insurance .factor!2 44,;00 7roducti3e wages 4,%),400 /irectors fee *,400 5eneral e#penses 4,%)0 5as and water .factor!2 4,)*0 +ales ),00,000 Tra3eling e#penses 2,;40 ManagerAs salaries .2C(rd for factor!, 4C(rd 45,000 for office2 /epreciation on plant and mac$iner! 4*,200 6epairs to plant and mac$iner! ),2(0 &arriage and cartage outwards ),020 /irect e#penses 40,040 6ent, rates, ta#es and insurance .office2 2,*00 5as and water .office2 5)0 +tock of materials as on (4st /ecember, 4;;5 *%,;20 &as$ discount allowed 4,0)0 Pre0are a statement /.4.n/ the -ollo1.n/ .n-ormat.on& 4. materials consumed 2. prime cost (. cost of production 4. cost of sales 5. net profit Page 3 Problem& 8 ()-9$ 6he accounts o- the Steel 1ays !n/.neer.n/ Co# ,td# Sho1 -or 177':

Materials used Manual and mac$ine labor wages directl! c$argeable :orks o3er$ead e#penditure >stablis$ment and general e#penses

4,*0,00 0 4,)0,00 0 40,000 4;,000

(a) +$ow t$e works cost and total cost, t$e percentage t$at t$e works o3er$ead cost bears to t$e manual and mac$ine labor wages and t$e percentage t$at t$e establis$ment and general e#penses bear to t$e works cost. (b) :$at price s$ould compan! -uote to manufacture a compan! w$ic$, it is estimated will re-uire an e#penditure of Tk. ),000 on wages so t$at it will !ield a profit of 25' on t$e total cost or 20' on selling price.

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