X Company

Analysis of Inventory and Related Accounts

December 31, 200X

INVENTORY OTHER RELATED ACCOUNTS

Audit
Per Client Adjustments Per Audit Account Title Amount
Particulars Dr(Cr) Dr(Cr) Dr(Cr) Debit Credit
1 Supplier's gross price for raw materials, P150,000 150,000.00 - 150,000.00
2 Materials purchased from another supplier on extended credit amounting to P570,000. The price to 570,000.00
be paid under normal
(20,000.00)
credit term550,000.00
is P550,000. Interest Expense 20,000.00
3 Invoice price of raw materials purchased amounting to P180,000. Quantity discounts of 10,5 are allowed
180,000.00
by supplier. - 180,000.00
4 Materials purchased from a supplier amounting to P616,000, inclusive of 12% VAT. The company is616,000.00
VAT registered and(66,000.00)
can claim this as
550,000.00
an input VAT.
Input Vat 66,000.00
5 Materials purchased from a supplier amounting to P515,000, inclusive of nonrecoverable purchases 515,000.00
tax of P15,000 515,000.00
6 Costs of transporting raw materials to the business premises, P5,000. 5,000.00 5,000.00
7 Import duties paid to authorities on import of raw materials to be used during the manufacturing process,
25,000.00P25,000. 25,000.00
8 Labor costs directly incurred in the processing of raw materials, P420,000 420,000.00 420,000.00
9 Normal amount of wasted labor, P57,000. 57,000.00 57,000.00
10 Abnormal amounts of wasted labor, P69,000. 69,000.00 (69,000.00) - Other Expense 69,000.00
11 Variable costs (electricity) incurred in the processing of raw materials, P10,000. 10,000.00 10,000.00
12 Costs of transporting goods to customers on sale, P2,500. 2,500.00 (2,500.00) - Delivery Expense 2,500.00
13 Non-recoverable purchase taxes charged to customers on sale, P12,000. 12,000.00 (12,000.00) - Taxes and Licenses 12,000.00
14 Non-recoverable sales taxes, P14,440. 14,440.00 (14,440.00) - Taxes and Licenses 14,440.00
15 Commission payable to salesmen on the sale of the goods, P14,500. 14,500.00 (14,500.00) - Selling and Administrative Expense 14,500.00
16 Provisions for bad and doubtful debt in relation to trade receivables, P56,000 56,000.00 (56,000.00) - Doubtful Account Expense 56,000.00
17 Costs of the accounts department, P140,000. 140,000.00 (140,000.00) - Selling and Administrative Expense 140,000.00
18 Head office costs relating to the overall management of the business, P234,000. 234,000.00 (234,000.00) - Selling and Administrative Expense 234,000.00
19 Borrowing cost incurred on inventories that takes substantial amount of time to create, P122,000.122,000.00 122,000.00
20 Storage cost for a maturing product, P56,000. 56,000.00 56,000.00
21 Selling costs, P45,600. 45,600.00 (45,600.00) - Selling and Administrative Expense 45,600.00
22 Non-production overheads cost of designing products for specific customers, P10,000. 10,000.00 10,000.00
23 Storage cost of finished goods, P23,000. 23,000.00 (23,000.00) - Storage Cost 23,000.00
24 Fixed administration costs/ overheads (rent for office), P450,000. 450,000.00 (450,000.00) - Selling and Administrative Expense 450,000.00
25 Insurance on in transit inventories, P17,800. 17,800.00 17,800.00
3,814,840.00 (1,147,040.00) 2,667,800.00 1,147,040.00 -

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