CHAPTER 8 - ACCOUNTING FOR LABOR

TRUE/FALSE
1.
True
2.
False
3.
False
4.
False
5.
False

6.
7.
8.
9.
10.

False
True
True
True
True

Problem 1 - Evergreen Company

A) 1. CHARGED TO THE JOB
2. CHARGED TO FACTORY OVERHEAD CONTROL

Direct materials
Direct labor
Factory overhead
Overtime
Total

CHARGED
JOB 401
28,000
18,000
5,600
______
51,600

CHARGED TO FOC
Other factory costs
Overtime
Total

TO JOB
JOB 402
37,000
23,000
11,200
6,000
77,200

P 16,800
6,000
P 22,800

CHARGED
JOB 401
28,000
18,000
7,600
______
53,600

TO FOC
JOB 402
37,000
23,000
15,200
______
75,200

x 1/3
X 2/3

Problem 2
No.
Regular
OT
Employee Hrs Rate
Pay
Hours
Austria
42
36.00
1,512
2
Bautista
43
36.00
1,548
3
DeSantos 44
45.00
1,980
4
Motus
40
30.00
1,200
Reyes
40
30.00
1,200
TOTAL
7,440
b)
1.
Payroll
Accrued payroll
2.

3.

Rate
18.00
18.00
22.50
-

Overtime
Premium
36.00
54.00
90.00
-__
180.00

Total
Pay
1,548
1,602
2,070
-___
7,620
7,620
7,620

Accrued payroll
Cash

7,620

Work in process (1,512 + 1,548 + 1,980)

FOC (1,200 + 1,200 + 180 )
Payroll

5,040
2,580

7,620

7,620

Page 2
Problem 3 - Norman Company
Employee Guaranteed
Wage
Cruz
2,000
Briones
2,000
David
2,000
Mendoze
2,000
Rivera
2,000
Tolentino
2,000
TOTAL
12,000

Total pay piece rate

(240 x 7.50)
(286 x 7.50)
(275 x 7.50)
(240 x 7.50)
(225 x 7.50)
(285 x 7.50)

Deficiency

1,800
2,145
2,062.50
1,800
1,687.50
2,137.50
11,632.50

2. Charged to Work in process

3. Charged to factory overhead account -

Total
Payroll
2,000.00
2,145.00
2,062.50
2,000.00
2,000.00
2,137.50
12,345.00

200
200
312,50
-___
712.50

11,632.50
712,50

Problem 4 - Ty-Nee Trailer Company

Deductions 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.

Employee
Castro
Ardina
Briones
David
Fajardo
Tomas
Villas
TOTAL

REGU
HRS.
42
45
48
48
45
42
40

LAR
RATE
40.00
50.00
40.00
40.00
40.00
40.00
40.00

Continuation
Employee
Total
SSS
Pay
Prem.
Castro
1,720.00 250.00
Ardina
2,375.00 333.30
Briones
2,080.00 283.30
David
2,080.00 283.30
Fajardo
1,900.00 266.70
Tomas
1,720.00 250.00
Villas
1,600.00 233.30
TOTAL
13,475.00 1899.90
Castro

PAY
1,680.00
2,250.00
1,920.00
1,920.00
1,800.00
1,680.00
1,600.00
12,850.00

OVER TIME
HRS. RATE
2
20.00
5
25.00
8
20.00
8
20.00
5
20.00
2
20.00
-

W/holding Phil.
Tax
Health
681.28
87.50
614.53
112.50
840.93
100.00
865.33
100.00
603.38
87.50
461.38
87.50
438.28
75.00
4,505.11
650.00

PAY
40.00
125.00
160.00
160.00
100.00
40.00
-__
625.00

Pagibig
100.00
100.00
100.00
100.00
100.00
100.00
100.00
700.00

TOTAL
PAY
1,720.00
2,375.00
2,080.00
2,080.00
1,900.00
1,720.00
1,600.00
13,475.00

Total
Net
Deduct Pay
1,118.78 601.22
1,160.33 1214.67
1,324.23 755.77
1,348.63 731.37
1,057.58 842.42
898.88 821.12
846.58 753.42
7,755.01 5719.99

Total pay (5,600 + 1,720) 7,320

( 4,167) - 208.33
3,153 x 15% - 472,95
681.28
Ardina
Total pay (7,500 + 2,375) 9,875
( 7,167)
208.33
2,708 x 15%
406.20
614.53
Briones
Total pay (6,500 + 2,080) 8,580
(7,917)
708.33
663 x 20%
132,60
840.93
David
Total pay (6,200 + 2,080) 8,280
( 7,500)
708.33
780 x 20%
156.00
864.33
Fajardo
Total pay (5,900 +1,900) 7,800
( 5,167)
208.33
2,633 x 15% 394.95
603.38
Tomas
Total pay (5,800 + 1,720) 7,520
( 5,833)
208.33
1,687 x 15% 253.05
461.38
Villas
Total pay (5,200 + 1,600)

2.

6,800
(5,267)
208.33
1,533) x 15% 229.95
438.28

Payroll
W/holding tax payable
SSS Premiums payable
Phil Health Contributions payable
Pag-ibig funds contributions payable
Accrued payroll

13,475.00
4,505.11
1,899.90
650.00
700.00
5,719.99

Accrued payroll
Cash

5,719.99
5,719.99

Work in process (12,850 1,680)

Factory overhead control (1,680 + 625)
Payroll

MULTILE CHOICE
1.
b
2.
b
3.
a
4.
b.
5.
a
`

6.
7.
8.
9.
10.

a
d
d
a
c

11,170.00
2,305.00
13,475

11.
12.
13.
14.

b
c`
692,500
d