E 2-5 - Items included in costCurry Corporation began operations in the current year. During theCear it incurred the following expenditures in purchasing materials forproducing its product:Purchase price of raw materials = P3,000,000Import duty and other non-refundable purchase taxesRefundable purchase taxesFreight costs for bringing the goods from the supplier to the factoryraw material storeroom = P300,000Costs of unloading the materials into the raw material storeroom =P2,000• Packaging = P200,000%3DP800,000||P100,000%3D%3DThe entity received P53,000 volume rebate from a supplier forpurchasing more than P1,500,000 from the supplier during the year.The entity incurred the following additional costs in the production run:Salary of the machine workers in the factory• Salary of factory supervisor = P300,000Depreciation of the factory building and equipment used forproduction process = P60,000Consumables used' in the production processDepreciation of vehicle used to transport the goods from the rawmaterials storeroom to the machine floorP500,000%3DP20,000%3DP40,000%3DFactory electricity usage charges = P30,000• Factory rentalDepreciation and maintenance of the entity's vehicle used by thefactory supervisor (50 per cent for official use and 50 per cent forpersonal use) = P20,000. Private use of the vehicle is an employeebenefit.%3DP100,000%3D%3D Depreciation and maintenance of vehicles used by the sales staff =Depreciation of the administration building = P50,000operations (e.g. financing, tax and corporate secretarial functions),Salaries of the administration personnel = P305,000The entity incurred the following selling expenses:attributable, in equal proportion, to the sales and other non-productionThe entity incurred the following administration expenses:Of the administration expenses 20 per cent are attributable toadministering the factory. The rest of the administration expenses areSalary of the administration personnel = P600,000usedby theDepreciation andadministrative staffmaintenance of vehiclesP15,000|3D%3DAdvertising costsP30,000%3DP10,000%3DRequired:Compute or the following:1. Costs of purchase2. Costs of conversion

Costs of purchase refers to the cost that is incurred for purchasing the materials and it also…

Curry Corporation began operations in the current year. During the Cur it incurred the following expenditures in purchasing materials for producing its product: Purchase price of raw materials = P3,000,000 * Import duty and other non-refundable purchase taxes = Refundable purchase taxes = P100,000 Freight costs for bringing the goods from the supplier to the factory raw material storeroom = P300,000 Costs of unloading the materials into the raw material storeroom = %3D P800,000 %3D %3D P2,000 • Packaging = P200,000 %3D The entity received P53,000 volume rebate from a supplier for purchasing more than P1,500,000 from the supplier during the year. The entity incurred the following additional costs in the production run: Salary of the machine workers in the factory = P500,000 • Salary of factory supervisor = P300,000 Depreciation of the factory building and equipment used for production process = P60,000 Consumables used' in the production process • Depreciation of vehicle used to transport the goods from the raw materials storeroom to the machine floor %3D P20,000 %3D P40,000 %3D • Factory electricity usage charges Factory rental Depreciation and maintenance of the entity's vehicle used by the factory supervisor (50 per cent for official use and 50 per cent for personal use) = P20,000. Private use of the vehicle is an employee benefit. P30,000 %3D P100,000 %3D %3D

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter10: Accounting Systems For Manufacturing Operations

Section: Chapter Questions

Problem 10.3E: Classifying costs as factory overhead Which of the following items are properly classified as part...