NBA Inc. is engaged in the business of manufacturing basket balls. The company employees actual costing...

   

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NBA Inc. is engaged in the business of manufacturing basket balls. The company employees actual costing system. The company uses a single account for direct and indirect materials. The company provided the following data for the year ended December 1, 2020: Gross sales Sales returns Gross purchases Purchase returns, allowance and discount Freight in Total costs of factory labor Depreciation of factory assets Expired insurance on factory assets Utilities expense on factory Total administrative expenses Total marketing expenses Inventories are as follows: 9,500,000 1,000,000 500,000 200,000 400,000 1,000,000 300,000 100,000 500,000 2,000,000 3,000,000 Raw materials Work in process Finished goods January 1 December 31 100,000 ? 500,000 300,000 200,000 600,000 The following additional data are provided: 1) The net profit ratio of the company before income tax for the year ended December 31, 2020 was 10% of net sales. 2) The direct labor cost for the year was four times the cost of indirect labor. 3) The cost of indirect materials used was P100,000. 1. What is the total prime cost? a. 1,700,000 b. 2,000,000 c. 1,800,000 d. 1,900,000 2. What is the total conversion cost? a. 2,000,000 b. 1,900,000 c. 2,100,000 d. 2,200,000 3. What is the cost of goods manufactured? a. 3,200,000 b. 3,100,000 c. 3,300,000 d. 3,000,000 4. What are the cost of goods sold and the cost of work in process on January 1, 2020, respectively? a. 3,100,000 and 500,000 b. 3,200,000 and 300,000 c. 3,000,000 and 400,000 d. 2,900,000 and 600,000 NBA Inc. is engaged in the business of manufacturing basket balls. The company employees actual costing system. The company uses a single account for direct and indirect materials. The company provided the following data for the year ended December 1, 2020: Gross sales Sales returns Gross purchases Purchase returns, allowance and discount Freight in Total costs of factory labor Depreciation of factory assets Expired insurance on factory assets Utilities expense on factory Total administrative expenses Total marketing expenses Inventories are as follows: 9,500,000 1,000,000 500,000 200,000 400,000 1,000,000 300,000 100,000 500,000 2,000,000 3,000,000 Raw materials Work in process Finished goods January 1 December 31 100,000 ? 500,000 300,000 200,000 600,000 The following additional data are provided: 1) The net profit ratio of the company before income tax for the year ended December 31, 2020 was 10% of net sales. 2) The direct labor cost for the year was four times the cost of indirect labor. 3) The cost of indirect materials used was P100,000. 1. What is the total prime cost? a. 1,700,000 b. 2,000,000 c. 1,800,000 d. 1,900,000 2. What is the total conversion cost? a. 2,000,000 b. 1,900,000 c. 2,100,000 d. 2,200,000 3. What is the cost of goods manufactured? a. 3,200,000 b. 3,100,000 c. 3,300,000 d. 3,000,000 4. What are the cost of goods sold and the cost of work in process on January 1, 2020, respectively? a. 3,100,000 and 500,000 b. 3,200,000 and 300,000 c. 3,000,000 and 400,000 d. 2,900,000 and 600,000

Answer rating: 100% (QA)

1 Total prime cost a 1700000 2 Total conversion cost a 2000000 3 Total cost of goods manufactured a ... View the full answer