Only need 4 of 6 questions answered
Question # 1
Asad & Company Limited present to you the following facts concerning the company’s operations for the years 2014.
Beginning inventory (at sales prices) 37,500
Purchases (at cost price) 52,500
Sales (at sales price) 75,000
Ending inventory (at sales price) 50,000
Marketing expenses 16,000
Administrative expenses 6,000
Required: An income statement for the year 2014
Question # 2
AI-Raheem Fabrics, during the month of January 2014, completed the following transactions.
(a) Materials purchased during January, 2014:
Direct materials Rs. 90,000
Indirect materials Rs. 10,000
(b) Materials issued for use in production:
Direct materials Rs. 80,000
Indirect materials Rs. 5,000
(c) Defective materials returned to supplier:
Direct materials Rs. 4,000
Indirect materials Rs. 2 000
(d) Unused material returned by factory to store room:
Direct materials Rs. 2,000
Indirect materials Rs. 1 000
(e) Payroll data for the month as follows:
Direct materials Rs. 60,000
Indirect materials Rs. 10,000
Salaries of marketing staff Rs. 30,000
Salaries of administration staff Rs. 20,000
Deduction (Less from total) of provident [email protected] 10% of gross earning Rs. 12,000
Net amount paid Rs.108, 000
Employer also contributes an equal amount towards provident fund.
(f) Factory overhead cost incurred during the month:
Bilk for utilities Rs. 12,000
Factory rent Rs. 16,000
Depreciation of plant Rs 4,000
Insurance of plant expired Rs. 2,000
(g) Factory overhead is applied to production @ 50% of direct labor cost.
(h) Cost of finished output during the moth Rs.150, 000.
(i) Finished goods costing Rs. 130,000 were sold for Rs.170, 000. Sales of Rs. 70,000 were for cash and of Rs. 100,000 were on credit.
Required:
Post entries in general journal form to record the above transaction.
Question # 3
Production of an order consisting 800 units requires direct materials of Rs. 350,000 and direct labor or Rs. 250,000. Factory overhead is applied at the rate of 80% of direct labor cast. After completion of the order, 16 units are classified as spoiled which can be sold for Rs. 4,000. Customer takes delivery of remaining 784 good units and paid in cash the contracted prices at the rate of Rs. 1,250 per unit. Spoiled units are sold and Rs. 4,000 received in cash.
Required:
(1) Journal entries, if the loss is charged to the order.
(2) Journal entries, if the loss is changed to factory overhead.
Question # 4
A worker takes 9 hours to complete a job on daily wages and 6 hours on a scheme of payment by results. His day rate is Rs. 7.50 per hour. Materials coast of the product is Rs. 400 and overheads are recovered at 150% of total direct wages.
Required: Calculate factory cost of the product under:
(1) Piece work Plan.
(2) Halsey Plan.
Question # 5
Annual estimated factory overhead of a company for an expected of 1, 80,000 pounds of a product was as follows:
Fixed overhead Rs 36,000
Variable overhead 1, 08,000
Output was 10,000 pounds in June and actual overhead expenses were 7,700.
Required:
(1) The Overhead Rate per unit
(2) Spending Variance.
(3) Idle Capacity Variance.
Question # 6
Following costs were charged to 2nd department of Muddesser Corporation during the month of September. Cost of units received from 1 department Rs. 364,000, materials Rs. 327,500, and labor Rs. 221,970, overhead Rs. 80,360.
During the month 2nd department completed operations on 4,700 units and transferred these units to 3rd department, 200 units were lost during processing, the loss is considered as unavoidable. At the end of month 300 units were in process, these units were 2/3 converted. All materials are added in 2nd department at the beginning of manufacturing operations.
Required: Cost of production report
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