Question

Use below information for Questions 6 to 9:

Company X is a manufacturing firm producing specialized equipments. June 1, 2018 B/S shows below balances:

Item	Beg
RM	4,250
MOH Applied	32,540
MOH Incurred	30,650

June 1, 2018 subsidiary ledgers (job cost sheets) show 3 jobs are being performed with following balances^[1]:

Assigned Costs	DM	DL		MOH
R	600	320		403
S	800	540		675
L	900	580		705

During June, RM purchases on account were TL4,970, and all wages (inclusive of payroll taxes) were paid in cash. Additional MOH of depreciation on factory equipment of TL900 was incurred together with miscellaneous production costs of TL470 on account. A summary of MRSs and LTTs shows below information (Hint: General use is also for production.):

Assigned Costs	DM		DL
R	850		850
K	2,000		850
S	500		360
L	1,300		1,200
R	300		390
General Use	1,500		1,200

MOH was charged to jobs at a rate of 1.35 per TL of DM costs. Jobs R, S and L were completed in June.R and S were sold in cash.

6)Compute the balance of WIP as at June 30.

7)Compute the balance of FG as at June 30.

8)Compute the balance of COGS as at June 30.

9)Calculate the balance of MOH account as at June 30. Use − if the MOH is underapplied. (e.g. if the account gives an overapplied balance of 100, enter 100. If the account gives an underapplied balance of 100, enter −100.)

Answer 1

Working Note 1: MOH

	Cost Incurred during June
Job	DM (A)	Rate Per TL of DM (B)	MOH Applied (AXB)
R	850	1.35	1148
S	500	1.35	675
L	1300	1.35	1755
K	2000	1.35	2700
R	300	1.35	405
General use	1500	1.35	2025
			8708

6. Calculation of WIP as at June 30:

Job	DM	DL	MOH	Total
K	2000	850	2700	5550
R	300	390	405	1095
General use	1500	1200	2025	4725
				11370

Note – General Use is also considered for production

7. Calculation of FG as at June 30:

Job	Assigned Cost till June1,2018	Assigned Cost during June
DM	DL	MOH	DM	DL	MOH	FG
L	900	580	705	1300	1200	1755	6440

8. Calculation of COGS as at June 30:

Job	Assigned Cost till June1,2018	Assigned Cost during June
DM	DL	MOH	DM	DL	MOH	COGS
R	600	320	403	850	850	1148	4171
S	800	540	675	500	360	675	3550
							7721

9. Calculation of Balance of MOH account as at June 30:

A. MOH Incurred
MOH Incurred as at June 1	30650
MOH Incurred during June	900	Depreciation
	470	Miscellaneous
Total MOH Incurred	32020
B. MOH Applied
MOH Applied as at June 1	32540
MOH Applied During June (WN1)	8708
Total MOH Applied	41248
MOH Overapplied (B-A)	9228