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MGMT Acct Case Analysis

This document contains information about budgets and cost analyses for three different companies - Alde Company, Lopez Corporation, and Pugo Corporation. Key details include: - For Alde Company, the budgeted materials purchase is P2,442,000 and the total budgeted manufacturing cost for 200B is P1,848,000. - For Lopez Corporation, the budgeted cost of goods sold is P1,612,000 and the budgeted purchases of raw materials is P2,896,000. - For Pugo Corporation, the total budgeted factory overhead for the third quarter is P441,200 and the total factory overhead cost per unit is P137,875.

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Ariel Dicoreña
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2K views3 pages

MGMT Acct Case Analysis

This document contains information about budgets and cost analyses for three different companies - Alde Company, Lopez Corporation, and Pugo Corporation. Key details include: - For Alde Company, the budgeted materials purchase is P2,442,000 and the total budgeted manufacturing cost for 200B is P1,848,000. - For Lopez Corporation, the budgeted cost of goods sold is P1,612,000 and the budgeted purchases of raw materials is P2,896,000. - For Pugo Corporation, the total budgeted factory overhead for the third quarter is P441,200 and the total factory overhead cost per unit is P137,875.

Uploaded by

Ariel Dicoreña
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Ariel Dicorea

BS Entrep -3A/Batasan Campus


Major In Marketing

CASE ANALYSIS
1. Alde Company prepared the following figures for its only product as a basis for
its 200B budget:
Budgeted sales
240,000
units
Selling price
P5
Required materials per unit of product
2
pieces
Materials beginning inventory
20,000
pieces
Materials ending inventory
24,000
pieces
Purchase price per piece of material
P3
Finished goods beginning inventory
15,000
units
Finished goods ending inventory
18,000 units
Direct labor hours, per 1,000 units of product
60
hours
Direct labor rate per hour
P30
Variable factory overhead rate per hour
P10
Fixed factory overhead
P300,000
Required:
a. What is the budgeted peso amount of materials purchases?
Sales budget
1,200,000
+desired finished good, end
90,000
Tgas
1,290,000
-expected finished goods, beg.
75,000
Budgeted production
1,215,000
X quantity of mat required
2
Materials to be used
2.430,000
+ desired raw mats. End
72,000
Raw mats available in use
2,502,000
-expected raw mats ,beg.
60,000
Budgeted mats purchases
2, 442,000
b. What is the total budgeted manufacturing cost for 200B?
Raw mats, beg
60,000
+ purchases
1,440,000
-raw mats, end
72,000
Raw mats used
1,428,000
Direct labor
120,000

FOH
Total manufacturing cost

300,000
1,848,000

2. Lopez Corporation has the following budget estimate for the year 200B:
Sales
P2,800,000
Income before tax
10% of sales
Selling and administrative expenses
25% of sales
Conversion cost (DL and FOH)
70% of total
manufacturing cost
Inventories are budgeted as follows:
Beginning
Ending
Materials
P176,000
P216,000
Work-in-process
200,000
240,000
Finished goods
280,000
336,000
Required:
a. What is the budgeted cost of goods sold?
Rm beg,
176,000
+purchases
376,000
-raw mats end
216,000
Raw mats used
336,000
Dl
686,000
Foh
686,000
Manufacturing cost
1,708,000
+wip, beg
200,000
Tcogpip
1,908,000
-wip, end
240,000
Cgm
1,668,000
+fg, beg
280,000
-fg, end
336,000
Cogs
1,612,000
b. What is the budgeted purchases of raw materials?
Sales
2,800,000
+FG, END
336,000
TGAS
3
,136,000
-fg, beg
280,000
Budgeted production
2,856,000
X quantity of mats required
Rm to be used
2,856,000
+rm, end
216,000
-rm, beg
176,000
Budgeted raw mats purchases
2,896,000

3. Pugo Corporation is preparing its factory overhead cost budget for the third
quarter of 200B. The management plans to produce 200,000 units for the said
quarter. Past experience has shown that the companys product is produced at
the rate of 4 units per hour. Variable rates per direct labor hour are as follows:
Indirect materials and supplies
P0.76
Power
1.36
Repairs and maintenance
2.80
Other variable overhead
0.96
Total
5.88
Total fixed overhead cost is budgeted at P147,200. For product costing
purposes, a fixed factory overhead rate of P3.20per direct labor hour has been
established.
Required:
a. How much is the total budgeted factory overhead for the quarter?
200,000/4= 50,000
Indirect materials and supplies
P0.76= 38,000
Power
1.36= 68,000
Repairs and maintenance
2.80= 140,000
Other variable overhead
0.96= 48,000
294,000
+147,200
441,200
b. The total factory overhead cost per unit is?
Foh cost/ unit
147,200/3.20=46,000
294,000/3.20=91,875
137,875

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