CHAPTER 8 - ACCOUNTING FOR LABOR

TRUE/FALSE1. True 6. False2. False 7. True3. False 8. True4. False 9. True5. False 10. True

Problem 1 - Evergreen CompanyA) 1. CHARGED TO THE JOB

2. CHARGED TO FACTORY OVERHEAD CONTROL

CHARGED TO JOB CHARGED TO FOC JOB 401 JOB 402 JOB 401 JOB 402

Direct materials 28,000 37,000 28,000 37,000Direct labor 18,000 23,000 18,000 23,000Factory overhead 5,600 11,200 7,600 15,200Overtime ______ 6,000 ______ ______Total 51,600 77,200 53,600 75,200

CHARGED TO FOCOther factory costs P 16,800Overtime 6,000Total P 22,800 x 1/3

X 2/3

Problem 2 No. Regular OT Overtime TotalEmployee Hrs Rate Pay Hours Rate Premium PayAustria 42 36.00 1,512 2 18.00 36.00 1,548 Bautista 43 36.00 1,548 3 18.00 54.00 1,602DeSantos 44 45.00 1,980 4 22.50 90.00 2,070 Motus 40 30.00 1,200 - - - -Reyes 40 30.00 1,200 - - -__ -___ TOTAL 7,440 180.00 7,620b)

1. Payroll 7,620Accrued payroll 7,620

2. Accrued payroll 7,620Cash 7,620

3. Work in process (1,512 + 1,548 + 1,980) 5,040FOC (1,200 + 1,200 + 180 ) 2,580

Payroll 7,620

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Problem 3 - Norman Company

Employee Guaranteed Wage

Total pay – piece rate Deficiency Total Payroll

Cruz 2,000 (240 x 7.50) 1,800 200 2,000.00Briones 2,000 (286 x 7.50) 2,145 - 2,145.00David 2,000 (275 x 7.50) 2,062.50 - 2,062.50Mendoze 2,000 (240 x 7.50) 1,800 200 2,000.00Rivera 2,000 (225 x 7.50) 1,687.50 312,50 2,000.00Tolentino 2,000 (285 x 7.50) 2,137.50 -___ 2,137.50TOTAL 12,000 11,632.50 712.50 12,345.00 2. Charged to Work in process - 11,632.503. Charged to factory overhead account - 712,50 Problem 4 - Ty-Nee Trailer CompanyDeductions were computed on the assumption that previous payment of wages were made without deductions and all deductions are made on the last payment for the month.

Assume the following amount as previous wages (for the past 3 weeks)Castro - 5,600Ardina - 7,500Brioes - 6,500David 6,200Fajardo 5,900Tomas 5,800Villas 5,200

REGU LAR PAY OVER TIME PAY TOTAL Employee HRS. RATE HRS. RATE PAYCastro 42 40.00 1,680.00 2 20.00 40.00 1,720.00Ardina 45 50.00 2,250.00 5 25.00 125.00 2,375.00Briones 48 40.00 1,920.00 8 20.00 160.00 2,080.00David 48 40.00 1,920.00 8 20.00 160.00 2,080.00Fajardo 45 40.00 1,800.00 5 20.00 100.00 1,900.00Tomas 42 40.00 1,680.00 2 20.00 40.00 1,720.00Villas 40 40.00 1,600.00 - - -__ 1,600.00TOTAL 12,850.00 625.00 13,475.00

ContinuationEmployee Total

Pay SSS Prem.

W/holding Tax

Phil. Health

Pag- ibig

Total Deduct

Net Pay

Castro 1,720.00 250.00 681.28 87.50 100.00 1,118.78 601.22Ardina 2,375.00 333.30 614.53 112.50 100.00 1,160.33 1214.67Briones 2,080.00 283.30 840.93 100.00 100.00 1,324.23 755.77 David 2,080.00 283.30 865.33 100.00 100.00 1,348.63 731.37Fajardo 1,900.00 266.70 603.38 87.50 100.00 1,057.58 842.42Tomas 1,720.00 250.00 461.38 87.50 100.00 898.88 821.12Villas 1,600.00 233.30 438.28 75.00 100.00 846.58 753.42TOTAL 13,475.00 1899.90 4,505.11 650.00 700.00 7,755.01 5719.99

Castro Total pay (5,600 + 1,720) 7,320 ( 4,167) - - 208.33

3,153 x 15% - 472,95 681.28Ardina Total pay (7,500 + 2,375) 9,875

( 7,167) 208.33 2,708 x 15% 406.20

614.53Briones Total pay (6,500 + 2,080) 8,580

(7,917) 708.33 663 x 20% 132,60

840.93David Total pay (6,200 + 2,080) 8,280

( 7,500) 708.33 780 x 20% 156.00

864.33Fajardo

Total pay (5,900 +1,900) 7,800 ( 5,167) 208.33 2,633 x 15% 394.95

603.38Tomas

Total pay (5,800 + 1,720) 7,520 ( 5,833) 208.33

1,687 x 15% 253.05 461.38

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VillasTotal pay (5,200 + 1,600) 6,800

(5,267) 208.33 1,533) x 15% 229.95

438.28 2. Payroll 13,475.00

W/holding tax payable 4,505.11SSS Premiums payable 1,899.90Phil Health Contributions payable 650.00Pag-ibig funds contributions payable 700.00Accrued payroll 5,719.99

Accrued payroll 5,719.99Cash 5,719.99

Work in process (12,850 – 1,680) 11,170.00Factory overhead control (1,680 + 625) 2,305.00

Payroll 13,475

MULTILE CHOICE1. b 6. a 11. none of the give2. b 7. d 12. d3. a 8. d 13. d4. b. 9. a 14. d5. a 10. c 15. c

Entry for No 11 should beWork in process – Job 1010 9,748Work in process – Job 1011 1,200Factory overhead control (1,250 + 37) 1,287

Payroll payable 12,235