The following events took place at the Barton Manufacturing Corporation for the current year:

1.Purchased P80,000 in direct materials.

2.Incurred labor costs as follows:

a. Direct labor, P42,000.

b. Supervisory labor, P11,500 (part of manufacturing overhead).

3.Purchased manufacturing equipment for P67,200.

4.Other manufacturing overhead was P80,500, excluding supervisory labor.

5.Transferred 70 percent of the materials purchased to work in process.

6.Completed work on 60 percent of the goods in process. Costs are assigned equally across all work in process.

7.Sold 90 percent of the completed goods.

There were no beginning balances in the inventory accounts. All costs incurred were debited to the appropriate account and credited to accounts payable.

Required:

2. Prepare journal entries to reflect these events.
4. Prepare T-accounts to show these events.
6. Prepare cost of goods sold statement from the data

Problem 2 (Cost Flows in a service organization)

For the month of March CBL Consulting Group worked 400 hours for Dynasty Manufacturing, 100 hours for Golden Manufacturing and 200 hours for Commissions, Inc. CBL bills clients at the rate of P100 per hour, while labor cost is P40 per hour. A total of 800 hours were worked in March, with 100 hours not billable to clients. Overhead costs of P12,000 were assigned to jobs (that is, clients) on the basis of direct labor-hours. Since 100 hours were not billable, some overhead was not assigned to jobs. CBL had P6,000 marketing and administrative costs. All transactions are on account.

2. Show the flow of cost through T-accounts.
4. Prepare income statement for CCG for the month ended March 31.
6. Prepare journal entries.