ACTBFAR: Exercise Set #1

Term 2, AY2021-2022
Individual output
(Source: Basic Financial Accounting and Reporting by Dela Cruz, Rabo, & Tugas)

GENERAL INSTRUCTIONS:
1. You have to provide the solutions to the problems in good form on clean pages of your
columnar notebook or 10-column worksheets using a blue or black ballpen only.
2. Answer chronologically.
3. Properly label the exercise number, requirement number, and the amounts.
4. Include peso sign accordingly.
5. Unless necessary, do not include decimal points for amounts.
6. Rule and double-rule amounts as needed.
7. For proper correcting of errors and other formatting guidance, please observe the
“Accounting Do’s and Don’ts” uploaded in the course files section of AnimoSpace.
8. Upload a scanned file/picture of solutions to the Problem Solving (PS) and the Financial
Statements in the related ‘assignment’ created in AnimoSpace.
Note: Do not upload a file of more than 100MB

DEADLINE: April 21, 2022, Thursday, 11:59 PM, AnimoSpace

RUBRICS FOR ASSESSMENT:

Exercise Sets (Homework)
CRITERIA EXEMPLARY SATISFACTORY DEVELOPING BEGINNING RATING
(97-100) (80-96) (70-79) (Below 70)
Content - The student The student The student The student
Correctness answers all answers majority of answers some of fails to answer
and assigned exercises the assigned the assigned all assigned
Completeness correctly and exercises correctly exercises correctly exercises
[70%] completely. and completely. and completely. correctly and
completely.
Neatness and The student The student The student The student
Orderliness answers all answers majority of answers some fails to answer
[10%] problem solving problem solving problem solving all problem
items in good items in good form. items in good form. solving items in
form*. good form.
Timeliness The student The student The student The student
[20%] submitted output submitted output a submitted output submitted
on or before the week after the two (2) weeks after output three
deadline. deadline. the deadline. (3) weeks or
more after
deadline.
TOTAL
*In good form: i.e., preserves neatness of work, writes legibly, labels all solutions, uses money columns correctly,
uses ruler, follows ruling procedures
Financial Statements (for Manufacturing, Partnership, and Corporation)
CRITERIA EXEMPLARY SATISFACTORY DEVELOPING BEGINNING RATING
(97-100) (80-96) (70-79) (Below 70)
Content - The student The student The student The student
Correctness prepares correctly prepares correctly prepares correctly fails to
and and completely all and completely and completely prepare
Completeness financial majority of the some financial correctly and
[70%] statements. financial statements. completely all
statements. financial
statements.
Neatness and The student The student The student The student
Orderliness prepares all prepares majority prepares some fails to
[10%] financial of financial financial statements prepare all
statements in statements in good in good form. financial
good form**. form. statements in
good form.
Timeliness The student The student The student The student
[20%] submitted output submitted output a submitted output submitted
on or before the week after the two (2) weeks after output three
deadline. deadline. the deadline. (3) weeks or
more after
deadline.
TOTAL
**In good form: i.e. i.e., preserves neatness of work, writes legibly, places heading properly, uses money columns
correctly, uses ruler, follows ruling procedures
REQUIRED:
EXERCISE 1. True or False. Questions 1-24.

EXERCISE 2. Multiple Choice. Questions 25-34.

EXERCISE 3-1. Classification I. Questions 35-44. Encode DM for direct materials, DL for
direct labor, and MOH for manufacturing overhead for the following product costs of a shoe
manufacturer.

EXERCISE 3-2. Classification II. Questions 45-54. Indicate the following costs of a candy
manufacturer as a product cost or period cost. For product cost, encode DM for direct
materials, DL for direct labor, and MOH for manufacturing overhead. For period cost, encode A
for administrative and D for distribution.

EXERCISE 3-3. Classification III. Questions 55-64. Encode D for direct cost and I for
indirect cost for the following costs of a manufacturing company with three production
departments and assuming Finishing Department is the cost object.

EXERCISE 3-4. Classification IV. Questions 65-74. Encode V for variable cost and F for
fixed cost for the following costs of a manufacturing company.

EXERCISE 4. Problem Solving. Answer the questions and upload the supporting
computations.
EXERCISE 4-1. Problem Solving. Questions 75-76.
Raw materials beginning balance is ₱20,000, raw materials ending is ₱34,000, and raw
materials purchases is ₱110,000. How much is cost of direct materials used?

Raw materials beginning balance is ₱24,000, raw materials ending is ₱30,000, cost of direct
materials used is ₱120,000, and cost of indirect materials used is ₱5,000. How much is raw
materials purchases cost?

EXERCISE 4-2. Problem Solving. Questions 77-80.

Work-in-process beginning balance is ₱50,000, work-in-process ending is ₱43,000, finished
goods beginning is ₱71,000, finished goods ending is ₱84,000, and total manufacturing costs is
₱220,000.
1. How much is cost of goods placed into process?
2. How much is cost of goods manufactured?
3. How much is cost of goods available for sale?
4. How much is cost of sales?

EXERCISE 4-3. Problem Solving. Questions 81-84.

Finished goods ending balance is ₱98,000 which is 25% more than its beginning balance. Total
manufacturing costs is ₱336,000, and work-in-process ending balance is ₱62,000 which is
₱10,000 less than its beginning balance.
1. How much is cost of goods placed into process?
2. How much is cost of goods manufactured?
3. How much is cost of goods available for sale?
4. How much is cost of sales?
EXERCISE 4-4. Problem Solving. Questions 85-87.
Cost of direct materials used is ₱77,000, cost of direct materials purchases is ₱122,000, raw
materials beginning balance is ₱25,000, cost of direct labor is ₱180,000, and manufacturing
overhead cost is 125% of direct labor cost.
1. How much is raw materials ending balance?
2. How much is applied manufacturing overhead cost?
3. How much is total manufacturing costs?

EXERCISE 4-5. Problem Solving. Questions 88-90.

Total prime costs is ₱200,000, total conversion costs is ₱300,000, and cost of direct materials
used is 50% more than direct labor cost.
1. How much is cost of direct labor?
2. How much is cost of direct materials used?
3. How much is manufacturing overhead cost?

EXERCISE 4-6. Problem Solving. Questions 91-94.

Total estimated overhead costs for the year is ₱1,000,000, total estimated activity level for the
year is 20,000 direct labor hours, actual total direct labor hours is 19,000, actual cost of direct
labor is ₱1,520,000, actual cost of direct materials used is ₱980,000, and actual manufacturing
overhead cost is ₱1,020,000.
1. What is the predetermined overhead rate?
2. How much is applied manufacturing overhead cost?
3. How much is total manufacturing costs based on actual cost system?
4. How much is total manufacturing costs based on normal cost system?

EXERCISE 4-7. Problem Solving. Questions 95-104

Sales is ₱250,000, gross profit rate is 18% of sales, net income is 3.5% of sales, finished goods
ending balance is ₱75,000 which is 20% less than finished goods beginning balance, work-in-
process beginning balance is ₱47,000, total prime costs is ₱120,000, total conversion costs is
₱150,000, manufacturing overhead is applied at 50% of direct labor cost, cost of raw materials
purchases is ₱50,000, and raw materials ending balance is ₱30,000.
1. How much is cost of sales?
2. How much is operating expenses?
3. How much is cost of goods available for sale?
4. How much is cost of goods manufactured?
5. How much is direct labor cost?
6. How much is total manufacturing costs?
7. How much is work-in-process ending balance?
8. How much is cost of goods placed into process?
9. How much is cost of direct materials used?
10. How much is raw materials beginning balance?
EXERCISE 5. Financial Statements – actual.
Using the data given on the next page,
(A) Answer the following questions using the Financial Statements that you will prepare in (B).
Question 105. How much is the net sales revenue?
Question 106. How much is the cost of direct materials used?
Question 107. How much is the manufacturing overhead cost?
Question 108. How much is the total manufacturing cost?
Question 109. How much is the cost of goods manufactured?
Question 110. How much is the cost of sales?
Question 111. How much is the total other income?
Question 112. How much is the total distribution costs?
Question 113. How much is the total administrative expenses?
Question 114. How much is the trade and other receivables?
Question 115. How much is the inventories?
Question 116. How much is the prepaid expenses?
Question 117. How much is the total carrying amount of the property, plant, and equipment?
Question 118. How much is the trade and other payables?
Question 119. How much is the total current assets?
Question 120 .How much is the total liabilities?
Question 121. How much is owner's capital, end?

(B) Prepare the following financial statements of ACTBFAR COMPANY for the month ended
March 31, 2022, assuming actual cost system. Upload the Financial Statements.
1. Functional-form Statement of Profit or Loss (with supporting notes);
2. Statement of Changes in Equity; and
3. Report-form Statement of Financial Position (with supporting notes).

EXERCISE 6. Financial Statements – normal.

Refer to Exercise 5.
Assuming normal cost system and the company applies manufacturing overhead cost at 170%
of direct labor cost. How much is the manufacturing overhead cost? Solution is not required.
Accounts Payable ₱ 76,000
Accounts Receivable 320,000
Accumulated Depreciation – Machinery 52,000
Accumulated Depreciation – Office Equipment 26,000
Accumulated Depreciation – Store Equipment 24,000
Allowance for Doubtful Accounts 16,000
Cash 488,000
Commissions Income 45,000
Depreciation – Machinery 27,000
Depreciation – Office Equipment 13,000
Depreciation – Store Equipment 12,000
Doubtful Accounts Expense 14,000
Factory Payroll (60% direct, 40% indirect) 400,000
Finished Goods Inventory, Mar 1 40,000
Finished Goods Inventory, Mar 31 37,000
Interest Income 3,000
Machinery 520,000
Notes Receivable 50,000
Office Equipment 240,000
Office Salaries 156,000
Other Costs (30% factory, 40% store, 30% office) 30,000
Prepaid Insurance Expense 60,000
R. Biff, Capital, Mar 1 ???
R. Biff, Drawing 85,000
Raw Materials Inventory, Mar 1 39,000
Raw Materials Inventory, Mar 31 46,000
Raw materials purchases 187,000
Rent (60% factory, 20% store, 20% office) 100,000
Repairs and Maintenance (60% factory, 40% office) 23,000
Salaries and Wages Payable 60,000
Sales 1,500,000
Sales Discount 21,000
Sales Returns and Allowances 15,000
Store Equipment 130,000
Store Salaries 234,000
Supplies Inventory (50% factory, 30% store, 20% office) 20,000
Supplies Used (40% factory, 30% store, 30% office) 48,000
Unearned Sales Revenue 50,000
Utilities (70% factory, 20% store, 10% office) 170,000
Utilities Payable 46,000
Work-in-Process Inventory, Mar 1 61,000
Work-in-Process Inventory, Mar 31 65,000