NATIONAL UNIVERSITY PEDRO FUIZ GALLO LAMBAYEQUE

PROFESSIONAL SCHOOL OF ACCOUNTING

COST MODULE PRACTICES

JANUARY 2021
 Jorge Romero Guzmán
Fecha:23/03/2019
Alumno. ----------------------------------------------------------------------
ENTRY EXAM
I. KNOWLEDGE: <3 points>
Define the following concepts
First cost

Normal cost

ABC Cost

II. UNDERSTANDING: <3 points>

Which inventory systems a) perpetual b) periodic, are considered obsolete

III. APPLICATION: <4 points>

Case 1. A company spends S/ 75.00 to produce 10 units of a certain item per day and S/
120.00 produce 25 units of the same item per day.
a) Determine the cost equation
b) What are the fixed and variable costs per unit?
c) What is the cost of producing 60 units?

Case 2 The manager of a factory must decide whether they should produce their own
packaging that the company has been acquiring from external suppliers at $1.10 each
one. The manufacturing of packaging would increase the company's overall costs by
$800 per month and the cost of materials and labor will be $0.60 per packaging.
How many packages should the company use per month to justify the decision to manufacture?
their own packaging?
IV. ANALYSIS: <4 pts>
Are the cost elements sufficient to separate the cost factors, or do they exist?
other mechanisms?

V. SYNTHESIS:
Create a synoptic chart that shows the elements of cost. <2 points>

VI. VALUATION: 4 points

Classification and costs in the industrial sector. The agro-industrial company TUMAN SAA
is dedicated to the cultivation and processing of sugarcane
Classify each of the following cost items as
a) Direct (D) and indirect (I)
b) Variables (V) and fixed (F)

No. Cost item Do I True or False

1 Cost of sugar cane

2 Plant superintendent salary
3 Plant worker Christmas dinner
4 Production engineer salary
5 Sugar fleet distributed at the level
national
6 Electricity of the plant
7 Salaries of contracted workers in
production campaign
8 Annual plant insurance policy
 Cpc Jorge E. Romero Guzmán

Exercises 1.

PRACTICE 1

1.- Calculation of the cost of materials used, production cost and

sales
The company Susana SAC provides the following data:
Initial inventories on December 31
2,019 2,020
24 Raw materials S/. 12,000.00 13,500.00
23 Produccion en proceso 15,100.00 17,600.00
21 Prod. Finished 19,500.00 21,200.00
Operation data:
Material purchases 50,000.00
Shopping freight 17,700.00
Return of purchases -2,000.00
Direct labor 97,000.00 includes social laws
General manufacturing costs 125% of the labor cost

2.- Calculation of the cost of materials used, production cost of

sales
The company Ariel SAC provides the following additional data:
Initial inventories on December 31
2,019 2,020
Work in progress 25,000 22,000
Product Finished 49,000 45,000
Raw Materials 2,000 6,000
Auxiliary Materials 5,000 2,000
Datos de operación:
purchase of raw materials S/ 25,000.00
Purchase order for raw materials 5,000.00
Purchase of auxiliary materials 6,000.00
Return of auxiliary materials purchases -3,000.00
Direct labor (does not include overhead) 32,000.00
Indirect manufacturing costs
Indirect labor (not including 9,000.00
machine maintenance 10,000.00
Depreciation of machinery 8,000.00 27,000.00

Social laws are: Essalud 9% Senati 0.75%

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3.- The company Renawar presents the following information about the period:
Initial inventory of direct materials S/. 11,000.00
Inventario final de materiales directos 13,000.00
Initial inventory of work in process products 25,000.00
Final inventory of work in progress products 10,000.00
Purchase of direct materials 95,000.00
Return of direct materials -3,500.00
Direct labor cost (includes LS) 110,000.00
Indirect manufacturing costs 70,000.00
Consumed parts 18,000.00
Production Supervisor (includes LS) 22,000.00
Factory cleaning service 13,000.00
Explosion insurance machinery 17,000.00
Initial inventory of finished products 15,000.00
Final inventory of finished products 45,000.00
Sales 380,000.00
Sales expenses 50,000.00
With this information prepare the following: Cost of the materials used in
the production, Cost of Production and Sales Statement; Income Statement

4.- Prepare a Production Cost Statement with the following data:

Purchases of materials S/.110,000.00
Shipping for purchases 16,500.00
Return of purchases 4,000.00
Direct work (includes social laws) 58,000.00
Indirect production costs:
Indirect material 5,500.00
Indirect work (includes LS) 45,000.00
Water 1,400.00
Light 3,000.00
Depreciation of machinery 40,000.00
Property tax 4,000.00
Initial inventory of materials 27,500.00
Final inventory of materials 20,000.00
Initial inventory of work in progress products 22,000.00
Final inventory of work-in-process products 18,000.00
Initial inventory of finished product 12,000.00
Final inventory of finished products 15,000.00
Sales return 4,000.00
Sales 345,480.00
With this information prepare the following: Cost of the materials used in
production, Cost of production and sales statement, Income statement

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5.- Comprehension exercise on cost reports

Calculate the missing values in the blank spaces
Production Costs CASE 1 CASE 2 CASE 3 CASO 4 CASO 5
Initial stock of raw materials 3,200 4,200 2,500 2,900 2,500
Stock final de mat. primas 3,000 1,000 3,000 2,300
Purchasing Raw Materials 10,000 11,000 12,000 14,000
Direct labor 1,000 4,000 3,000 1,000 2,000
Plant Management Salary 750 1,500 2,000 1,000 1,200
Factory supplies 350 600 1,000 250 630
Factory phone 250 750 500 400 320
Machinery maintenance 1,300 1,000 1,500 500 800
Depreciation of machines 500 750 1,500 600 600
Product in initial process 5,000 6,000 6,500 9,000
Production in final process 7,000 9,000 12,000 11,000 8,500
Initial stock of finished products 10,000 25,000 10,000 8,000 6,000
Final stock of finished products 8,000 6,000 5,000 3,200
Cost of sales 38,800 18,200 15,850 22,350
Note: labor costs include social laws

EXERCISE 6.
In an industrial company BOMBER SAC, the following information corresponds to a
TheVATisnotpartofthecostasitisataxcredit.
Data: S/ S/ S/
Indirect labor in Inventory Inventory
4,000.00 DETAIL
factory Initial Final
Purchases of Raw Materials 9,300.00Productos Terminados 1,350.00 940.00
Freight overpurchases 250.00 Products in process 700.00 450.00
Energyconsumption 608.00 Raw materials 630.00 320.00
Depreciation of machines and
430.00
plant equipment
Direct labor 5,100.00
Guardianship 500.00
Buy supplies
600.00
auxiliary materials
Other manufacturing expenses 335.00
REQUIRED
Determine the Cost of Production Statement
Determine the Cost of Sales Statement
Determinar el Estado de Resultado, si cada producto se vende con el 35%
the utility over its cost and the administrative expenses amount to S/.897.00 and
h
tesaelsexpensesS4
./450
.0
Determine the unit cost of production
2053 products were elaborated and all were sold.

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COST ACCOUNTING PRACTICE 2

1.- Bolsix produces plastic bags, in May it incurred the following costs:
Materials S/ 40,000 (75% is direct materials)
Labor includes LS 20,000 (65% es de mano obra directa)
CIF 20,000 (60% electricity and 40% depreciation)
Selling expenses 35,000 (commissioned sellers)
Administrative Expenses 19,000 (office rent)
90% of the production in May was completely sold for S/. 150,000.00
The initial work in process is S/ 3,500.00 and the final is S/ 4,200.00
Prepare the Cost of Production Statement, the Income Statement and
determine the prime cost for the month of May.

2.- Renzo Costa SAC produces wallets, in December it has the following
information:
S/. 190,000 as the total of materials used in production, of which
S/ 180,000 was considered as direct material.
$175,000 as total labor cost (includes LS) applied in the
production and of which S/ 150,000 was considered as labor
indirect.
$75,000 as indirect manufacturing costs, factory depreciation.
S/. 15,000 as initial inventory and 20,000 final of products in process.
S/. 30,000 as selling expenses (freight transport).
$20,000 as administrative expenses (theft insurance).
The initial inventory amounts to 2,000 units at a cost per unit of S/. 20.
15,000 units are completed in the period, 12,000 are sold at S/.
600,000.
It is requested to determine the following:
• Production cost.
• Cost of sales
• finished goods production.
• Income Statement.

3.- The industrial company COPERNICO SAC presents us with the following
information as of 12/31/XX
Initial inventory of products in process S/. 16,000
Final inventory of work in progress products 17,000
Consumption of raw materials 89,000
Factory Supplies Consumption 3,000
Direct labor 21,000
Indirect manufacturing costs 26,000

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Machinery maintenance S/ 6,000
Waste treatment 12,000
Building depreciation plant 8,000
Initial inventory of finished products 33,000
Final inventory of finished products 43,000
Sales 300,000
Selling expenses 70,000
Advertising 30,000
Transport 40,000
Administrative Expenses 28,000
Rental space 12,000
Sure 16,000
It is requested to determine:

• Production cost.
• Cost of finished goods
• Cost of Sales
• Income Statement.

4.- The industrial company ABC provides the following information for the month of
May.

DETAIL IMPORT OBSERVATIONS

USED SUPPLIES 200,000 75% are direct
PAYMENT OF REMUNERATIONS 75,000 20% corresponds to supervision
of plant
OTHER INDIRECT COSTS 125,000 Rent 45%, insurance 35%
Plant service 20%
ADMINISTRATIVE EXPENSES 85,000 Salaries workers
Selling Expenses 98,000 Distribution (transport)

The inventories of the current period are: Inicial Final

Production in process S/. 15,000 23,000
Finished products 21,000 22,800
Sales amount to $600,000
It is requested to prepare the cost of production and sales statement and the statement of
results.
5.- The industrial company PARRIMIL SAC provides the following information
for the month of May.

DETAIL IMPORTE OBSERVACIONES

USED SUPPLIES 250,000 85% are direct
PAYMENT OF REMUNERATIONS 80,000 70% are plant technicians
OTHER INDIRECT COSTS 205,000 Depreciation 45%, repair 40% on the
the balances are uniform plant

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ADMINISTRATIVE EXPENSES 75,000 Salaries
SELLING EXPENSES 105,000 Advertising
VOLUME OF PRODUCTION 10,000 UNITS
In this month, the initial inventory of products in process was S/
65,000 and the final inventory S/ 48,000. The initial inventory of products
finished was 400 units at a cost of S/ 50 each and the inventory
final 800 units (FIFO valuation method). Sales amount to S/.
800,000.
It is requested to prepare the cost of production and sales statement and the statement of
results.
6.- The company CONSUL SAC presents the following information as of 31.05.20XX:
Production of 1,300 units and 1,100 are sold at S/. 360.00 each + VAT.
The initial inventory of raw materials was S/. 15,000, the purchases were
S/. 80,000 and the final inventory was S/. 20,000:
The conversion costs were: direct labor S/. 12,000 and costs
indirect manufacturing costs S/. 43,000. The final work in process amounts to
S/. 10,000. The initial inventory of finished products was 400.
units at a cost of S/ 102.00 each.
Selling expenses were 25% of the sale value and the expenses of
management of 15% of it.
Prepare a cost of goods sold statement, knowing that the company applies the
average cost method.
Prepare a cost of sales statement, knowing that the company applies the
FIFO method.
With the first result, formulate the income statement.

7.- With the information provided for the month of May prepare
the cost of goods sold statement and calculate the unit cost of
finished product called 'FIORI' from the industrial company LADY SAC.

Materials purchased 202,000 Factory management 3,000

Plant rental 3,000 Depreciation of machinery 10,000
Purchased supplies 2,800 Indirect work 6,000
Light and electrical energy 5,000 Tool consumption 1,000
Direct Work 98,000 Social Charges of the MOD______
Machinery insurance 2,000 Factory repair 200
INVENTORIES INITIALS FINALS
Materials 100,000 25,000
Products in process 40,000 10,000
Finished products 1,800 44,350
Supplies 1,000 1,500
The sales for the month were 920,000 soles.

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8.- The industrial company EL POLOLO SAC dedicated to the sale of polos,
project the following information for the month of June.
Raw materials used $7,250
Indirect material used 1,370.
Direct labor at piece rate S/. 1.00 per unit produced
Salary of the cost accountant 2,200
Administrator's salary 2,100
Sales salaries 1,700
Building rental (The production area uses ½ building) 1,600
Rental of overlock machine per month S/. 0.20 (per unit produced).
Rights for the use of patents (calculated on the basis of Units
produced at a rate of S/. 0.10 per unit
Contributions and social contributions of the month Essalud and Senati
(Producción 50%, Administración 20%, ventas 30%)
Various Production Expenses 1,980
Various Sales Expenses 1,320
Various administrative expenses 1,680
The company will produce 20,000 polos, the selling price of each polo is
S/. 8.00 + VAT
It is requested to determine:

• Costo de primo y conversión proyectado

• Production cost and the unit cost
• Projected Income Statement for June.

9.- The industrial company PENCIL SAC produces the pen product and in the month
In May 2018, the production process of 15,000 pens began.
present the following information:

INVENTORIES APRIL 01 31 APRIL

Raw material 1,900 690
Finished Products 2,300 2,100
Various supplies 600 190

During the month, it incurred the following costs and expenses:

Purchase of raw materials 1,750
Purchase of various supplies 1,620
Payment of salaries 2,500
Social Contributions 310
Other manufacturing expenses 790
Administrative Expenses 810
Sales Expenses 670

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10,000 pens were sold with a profit margin of 90% on the

production cost, determine:
• Projected premium cost and conversion
• Unit cost
• Cost of Sales
• Income Statement

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Exercises week 2.
Practice 1
Cost system by manufacturing orders, practical case
The Company Plásticos S.A. produces toys through the cost system
Production Orders for manufacturing plastic and metal toys.
Orden N° Pedido Client F. inicio [Link]
210 5,000 Electric trains Merly Burga 02-Jan 22-Jan
211 34,000 dolls Sandy Acosta 03-Jan 25-Jan
212 15,000 board games Lesli Inga 04-Ene 06-Feb
The operations of a cost period are as follows:
At the beginning of January of 201x, it has the following initial balances:
Raw materials warehouse 250,000
Work in Progress 150,000
Machinery 1,200,000
Accumulated depreciation 300,000
The analysis of accounts is as follows:
Raw materials warehouse S/
Plastic raw materials 10,000.00 kg a S/. 20.00 c/u 200,000.00
Metal raw materials 5,000.00 kg at S/. 10.00 each 50,000.00
Total 250,000.00
Production in progress OT 210
Direct materials 100,000.00
Direct labor 20,000.00
Cif 30,000.00
Total 150,000.00
Operations:
Jan 1 Purchases from suppliers (vc) S/. 550,000.00 of raw materials:

Raw materials warehouse S/

Plastic raw materials 20,000.00 kg at S/. 20.00 each 400,000.00
Metal raw materials 15,000.00 kg at S/. 10.00 each 150,000.00
Total 550,000.00
In addition auxiliary materials (vc) S/ 12,500.00
Greases and Lubricants for machinery (vc) 3,500.00
2 ene Se devuelven materias primas metálicas con defectos 2,000 kg. a S/. 10.00
S/ 20,000.00
January 5: Direct raw materials leave the warehouse according to the exit vouchers.
warehouse materials as follows:
Vales No OT Concept cantidad Costo u costo total
136 210 Plastic raw materials 3,000 kg at S/. 10 30,000.00
138 211 Plastic raw materials 15,000 kg at S/. 20 300,000.00
139 211 Metallic raw materials 4,000 kg at S/. 10 40,000.00
141 212 Plastic raw materials 10,000 kg at S/. 20 200,000.00
142 212 Metallic raw materials 8,000 kg at S/. 10 80,000.00
Total direct materials consumed 650,000.00

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January 7 Furthermore, the following indirect materials:

Auxiliary Materials S/ 11,000
Greases and Lubricants for Machinery 3,500
January 30 The payroll of workers amounts to S/
250,000.00.
The application of MOD according to worked time reports is as follows:
Order Hours Quota per hour
Total
210 electric trains 5,000 6.00 30,000.00
211 dolls 15,000 6.00 90,000.00
212 board games 10,000 6.00 60,000.00
Totals 30,000 180,000.00
The wages for indirect labor amount to S/ 70,000.00
Add Essalud and Senati to the workforce
January 30: The predetermined indirect costs are applied using a rate.
default based on MOD hours with the formula:
Predetermined CIF rate = CIF. Predetermined / total hours of direct labor
Predetermined CIF rate = 225,000/30,000 hrs = S/ 7.50
Jan 30. The indirect costs incurred during the cost period are S/
Production consulting 13,400.00
Assembly plant 33,500.00
Machinery repair 26,800.00
Factory property tax 20,100.00
Manipulation of chemical waste 40,200.00
January 30 The depreciation of machinery 10% annually amounts to S/ 10,000.00 per month.
During the month, production orders 210 and 211 were completed.
Jan 30. Finished toys from orders 210 and 211 are for sale as follows:
Order S/.
210 Electric trains 375,000.00
211 Dolls 815,000.00
1,190,000.00
The cost of sales for the previous orders is recorded.
January 30 The operating costs of the period amount to S/ 260,000.
Shipping costs (freight transport) 95,000.00
Administration expenses (office rent) 74,000.00
Financing expenses 10,000.00
Note: Apply employee participation NIC 19 and calculate the tax on
rent
It is requested:

Journal entries
Production cost statements and
Income statement (N and F)

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Practice 2
PRACTICAL EXERCISE ON PRODUCTION ORDERS
Muebles Finos, SA manufactures desks of different models, uses the system of
costs by Production Orders, presents us with the balances for the month of May:
I. ALMACEN DE MATERIAS PRIMAS
Subject Unit Price Amount
Amount
First measure unitary Total
Material 'A' mts 15,000 8.00 120,000.00
Material 'B' mts 8,000 5.00 40,000.00
Material 'C' mts 4,500 3.00 13,500.00
Total S/ 173,500.00

II. WORK IN PROCESS INVENTORY

ORDEN 101: 1,300 escritorios de pino, Cliente Marco Salas:
COST AMOUNT S/
Direct Raw Material 88,000.00
Direct Labor 14,000.00
Indirect Manufacturing Costs 18,000.00
TOTAL S/ 120,000.00
III. During the month of May, the following movements are recorded.
1. During the course of operations, the following orders are issued:
Order No. Request F. inicio [Link]
1021,600 desks Walnut LM-1 May 2 22 days Reiser and Curioni SA
1031,200 mahogany desks TM-2 May 03 20 days MC del Castillo SRL
1041,100 Safiro TM-2 desks 04-May 15 days The Tricotense SA
2. El departamento de costos opera los siguientes movimientos:
May 1, shipments covered by the warehouse are received.
fact.003-7829 of Maderas Continental, SA as follows:
Subject United Price Amount
First measure Quantity unitary Total
Material 'A' mts 25,000 9.00 225,000.00
Material 'B' mts 22,000 6.00 132,000.00
Material 'C' mts 17,500 4.50 78,750.00
Total S/. 435,750.00

3. On May 02, invoices 002-580, 002-582 are received from local suppliers.
001-2583, that support the purchase of indirect materials that were
Entered directly into the Warehouse, with a total cost of S/ 85,000.00.
4. On May 3, indirect materials included in invoice 002-582 were returned.
with a cost of S/ 5,000.00
5. According to the Raw Materials Kardex Assistant on May 3rd
the consumption of direct materials was as follows:

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REQUEST ORDER OF CANTIDAD PRECIO
MATERIAL TOTAL AMOUNT S/.
CION PROD MTS UNITARY
2880 101 C 3,500 4.50 15,750.00 15,750.00
102 A 9,000 9.00 81,000.00
2881 102 B 7,000 6.00 42,000.00
102 C 5,000 4.50 22,500.00 145,500.00
103 A 10,000 9.00 90,000.00
2882 103 B 8,500 6.00 51,000.00
103 C 3,000 4.50 13,500.00 154,500.00
104 A 5,500 9.00 49,500.00
2883 104 B 4,800 6.00 28,800.00
104 C 6,000 4.50 27,000.00 105,300.00
TOTALRAW MATERIAL 421,050.00
Other Warehouse Exits, indirect materials used amounted to S/
65,074.10 Requisición 2884
5. May 30 The total factory wages amount to S/ 235,000.00 for the month.
The distribution of salaries and wages at the factory is as follows:
DIRECT LABOR CONCENTRATE
USED IN PRODUCTION
ORDER OF QUANTITY COST AMOUNT
PROD HRS UNITARIANS/
101 910 8.50 7,735.00
102 9,300 8.50 79,050.00
103 7,500 8.50 63,750.00
104 3,250 8.50 27,625.00
TOTAL 178,160.00 Add Essalud and Senati

The rest of the sheet corresponds to salaries of superintendents and others.

(ME).
6. 30 May Various manufacturing expenditures were made in the exercise, including the following:

Concept Amount S/.

Immediate consumption combustible 11,000.00
Immediate consumption lubricants 4,800.00
Lighting 2,200.00
Fire insurance 25,000.00
Factory space rental 20,000.00
Caring for the environment 2,300.00
Repairs 8,500.00
Technical production advisors 3,500.00
Internet 1,800.00
Telephones 3,500.00
Total 82,600.00
7. In physical counts conducted in the Raw Materials Warehouse, it
a shortage of S/ 2,500.00 was determined, which is considered normal.
The depreciation of fixed manufacturing assets amounts to S/ 75,000.00

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9. The indirect manufacturing costs are transferred, recorded with the technique
from Valuation of Historical Costs (see note 2).
10. During the period, production orders No. 101, 102 were completed.
and 103. Which are transferred to the Finished Goods Warehouse. It remains
order number 104 is in process.
11. Cash sales of 2,000 desks are made:
1,000 desks (OP 101) S/ 309,943.00
1,000 walnut desks (OP 102) S/ 500,000.00
Total S/. 809,943.00
The cost of goods sold must be recorded.
12. The administrative and sales expenses for the period are as follows:
Administration expenses:
Personal service $ 50,000
Legal fees 5,000
Surveillance 6,800
Sales expenses:
Propaganda 23,000
Freight 8,000
14. Waste is sold for cash for S/ 1,200.00
Note: They should be considered as other income, therefore, it should be credited to the
account of: Other Income
IV. IT IS REQUESTED:

Journal Entries
Mayor
Prepare the Cost of Production and Sales statement.
Prepare the income statement in a simple format.
Prepare the 4 production orders, considering that Order 101
it has accumulated costs from the previous period and that order 104 has not been
completed.
Clarifying notes on the exercise.
The processing is carried out through a single production department.
2. Indirect manufacturing costs are applied to production orders.
according to the direct man hours used in each order:

Application coefficient = Total - cif

Total HH

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Practice 3

PRACTICAL EXERCISE ON PRODUCTION ORDERS

The CIA. Janet SAC industry shows us its information as of February 1st.
The production orders are as follows:
order Delivery date Client: requested units
101 28-Feb Carolina Laos 510 unit
102 23-Feb Carla Rojas 305 unit
103 13-Feb Milagros Maco 128 unid.
104 20-Feb Patricia Fiori 233 unit.

The accounts of indirect costs (CIF) are closed at the end of the month by transferring the
balance of the CIF on over or under applied cost of sales.

note:
24 Raw materials S/. 65,000.00 (1)
23 Products in process 37,300.00 2
25 Miscellaneous Supplies 4,000.00

The largest raw materials assistant shows the following

MaterialX10,000 units at S/ 4.00
Material 5,000 units at S/. 5.00

The largest work in process auxiliary shows the following balances:

OP # Products Material MOD CIF Total

101 Alpha 2,000.00 2,600.00 2,500.00 7,100.00
102 Beta 4,200.00 5,000.00 4,000.00 13,200.00
103 Gamma 2,500.00 3,000.00 3,800.00 9,300.00
104 Orion 3,000.00 2,000.00 2,700.00 7,700.00

During the month of February, the following operations were carried out:

1.- Purchases: S/ S/
MaterialX 3,000 units to 3.00
MaterialX 4,000 units to 4.00
MaterialY 2,000 units to 6.00
Suministros diversos Total 3,000.00

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2.- From the largest materials, the following is applied (average cost) in February:

Requisition MaterialXMater.Y
116 20% 10% on the order # 101
117 10% 30% off the order # 102
118 20% 10% on the order # 103
119 40% 20% off the order # 104
120 Various supplies S/ 3,000 to several

3.- The labor incurred in February was distributed as follows:

Direct Labor Hand $36,000.00

60% to order # 101 Add Labor Laws

12% on order #102 Essalud 9.00%
18% to order # 103 I felt 0.75%
10% to order # 104 Cts 8.33%

Indirect Labor S/. 3,000.00 CIF

4.- The factory overhead costs amount to S/47,250.00
Sure 21,000
Machinery maintenance 26,250
5.- The CIF is applied to the orders as a fee for the use of raw materials.
consumed in the month of 50%
6.- The jobs were finished and sent to the clients
The profit margin in the company is 100%

It is requested:

1.- Value the Work Orders

2.- Record the accounting entries
3.- Statement of cost of production and sales
4.- Prepare income and loss statement by nature and function.

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ASSIGNED PRACTICE
CASE NO. 04: PRODUCTION ORDERS
Yesterday, Zelada, General Manager of the gastronomic company Causita Rica SA has
hired a quality expert as an advisor, to prepare the cost of the
next year, for which he provides the required information:
1. Request for food materials
per unit Unit Plato A Plato B Plato C
Material 1 gram 150 130 100
Material 2 gram 60 70 60
Material 3 gram 90 40 50
2. Direct labor hours in preparation:
Labor hours Plate A Plato B Plato C
For every 100 plates 3 1 2
The labor hour costs S/ 10.00.
3. Inventory Information
Cost per
Unid Inventory Inventory
Concept 100 grams
measure Initial gr final gr
S/
Material 1 grams 10,000 8,000 2.00
Material 2 grams 15,000 4,000 2.67
Material 3 grams 5,000 3,000 4.00
4. Dishes throughout the year

Plato A Plato B Plato C

Price per plate S/ 40 20 30
Sales of unit plates. 15,000 10,000 10,000
5. The estimated indirect preparation costs are S/ 7,500 and are applied.
based on the hours of labor
6. Indirect preparation costs:
Cleaning materials S/ 600
Rental location 3,000
External advisor 2,000
Light/water 1,250
Insurance 380
Waste evacuation 580
Municipal taxes 600
Depreciation of machinery 1,300
Prepare:
Cost sheet of the operations for the period and gross result.
Statement of results

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Production Order No.

article: Fecha entrega:
units: Selling price:
Client: Unit cost. S/
Direct mat. Labor D Indirect costs of
No.
concepto cantidad Importe Horas Importe S/. Fecha Amount
req.

Total direct mats To death Total CIF

Summary of production cost
Materials S/
Direct Labor
Indirect costs
Total Cost

Production Order No.

article: Delivery date:
units: Selling price:
Cliente: Unit cost. S/
Direct math Labor D Indirect costs of
No.
concepto cantidad Importe Horas Importe S/. Fecha Amount
requirements.

Total direct mats To death Total CIF

Summary of production cost
Materials S/
Direct Labor
Indirect costs
Total Cost

9
 Cpc Jorge E. Romero Guzmán

Production Order No.

article: Delivery date:
units: Selling price:
Client: Unit cost. S/
Direct mat. Labor D Indirect costs of
No.
concepto cantidad Importe Horas Importe S/. Fecha Amount
required.

Total Direct Materials To death Total CIF

Summary of production cost
Materials S/
Direct Labor
Indirect costs
Total Cost

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 Cpc Jorge E. Romero Guzmán

Practice 5

PRACTICAL EXERCISE ON PROCESS COSTING

The company Rosario SAC has started its activities and requires two
Process departments.
Direct materials are added in Departments A and B.
Apt. A Department B
Units:
They started the process » 60,000 0
Transferred to the following -50,000 50,000
Finished Units 0 40,000
Final units in process: materials at 100% 10,000 10,000
Degree of progress of conversion costs 70% 25%
Period costs:
Purchases of materials S/. 319,000
Direct unit materials (per processed unit) 3.5 2.16
Direct Labor (rate per processed unit) S/. 1 4
Indirect manufacturing costs 150% of the labor cost.
Administrative Expenses S/ 20,006
The production is sold with a profit of 30% per unit.
Note: the MOD (includes social laws)
It is requested:

1.- Determine equivalent production

2.- Determine the production cost by process for the present
3.- Determine the unit costs
4.- Run the respective accounting entries
5.- The usefulness of exercise

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 Cpc Jorge E. Romero Guzmán

Practice 6
Joint Cost Practice

Currently, the existence of clothing manufacturing workshops generates

a large amount of jobs, partially alleviating the problem of unemployment.
Evelyn Vásquez is one of these people who work in this field.
presenting the following information about your tailoring workshop:

SEWING WORKSHOP: Lulú SAC

Production: Price of
unit sale.
3,000 Blouses at S/ 15.00
800 Shorts 25.00
4,000 Skirts 20.00

Costs:
Direct cost -unitarians-
hand material of
first work
Blouses S/ 6.75 6.00
Shorts S/ 10.00 8.00
Skirts S/ 6.00 4.00
labor includes social laws

Common cost totals

Manufacturing costs 1,800.00
Depreciation 700.00
Evelyn sells 80% blouses, 100% shorts, and 90%
skirts but doesn't know if he is winning or losing in the business, so
who hires Jorge García, partner of the accounting firm 'Peor es nada' SAC to
to conduct a cost study
Jorge is asked:
Determine the production cost for each product
Prepare income statement by product
Run the accounting entries

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 Cpc Jorge E. Romero Guzmán

Practice 7
ESTIMATED COSTS

The National Bottling Company S.A. produces carbonated water in boxes of 24.
bottles, whose estimated cost is as follows:

Estimated cost per box of 24 bottles

Materiales 7.60
Labor 1.70
Indirect factory costs 1.00
S/10.30

The selling price per box is: $13.00

The production in the month is 55,000 boxes
They were sold 53,000 boxes
There are no initial stocks
The finished work in process amounts to 300 boxes with a progress of:
Materials to 100%
Labor and indirect costs at 60%
The operations during the month were: S/
Direct materials are purchased for the amount of 500,000
The requisition of materials amounts to 430,800
Direct labor (includes social laws) 95,000
Indirect labor (includes social laws) 15,000
Force used 9,700
Water consumption 10,000
Depreciation of machinery and equipment 9,000
Factory maintenance and repair 12,000
Administrative office expenses 35,000
1,116,500
It is requested:

Estimated production cost

Adjustment of variations by the method of coefficients
Income statement

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 Cpc Jorge E. Romero Guzmán

Practice 8

STANDARD COSTS
The following Standard cost sheet is available.
S/ S/.
Materials D 10 Kg. to 6.00 60.00
[Link] O. 5 hrs. a 2.00 10.00
CIF 5 hrs. a 4.00 20.00
Unit cost. Standard 90.00

Budget:
Indirect factory costs $2,000.00
Production capacity (direct labor hours) 500
Operations:
1.- 1,500 Kg are purchased at a cost of S/ 6.20 per kg
2.- The requisition of direct materials is 975 kgs
3.- Direct labor is 450 hours at S/ 2.10 per hour
4.- Actual indirect costs $2,200.00
30 units are for sale at S/ 200.00 each
6.- Operating expenses amount to $2,000.00
Informe de volumen de producción:
Production completed 75 units
Work in progress (100% of materials and 50% labor and overhead) 20 units
It is requested:

Determine the inefficiencies of production

Accounting of operations
Determine the result

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 Cpc Jorge E. Romero Guzmán

QUALIFIED PRACTICE
The company Gordillo S.A. manufactures two types of shirts, which it calls A and B.
At the beginning of each year, the cost estimates for manufacturing are formulated.
and the selling prices are set.

For the current year, the estimated costs and selling prices were:

UNIT COST SHEET

TYPES OF SHIRT
S/ A B
Direct material 4.00 2.50
Labor (including social laws 2.00 1.00
Indirect production costs 2.00 1.50
8.00 5.00

The inventory of materials as of January 1st was S/ 2,000.00

The operations of the month were:

1.- Purchase of materials S/ 5,000.00

2.- Forms:
Direct labor (includes social laws) 2,700.00
Indirect labor (includes social laws) 2,000.00
3.- Indirect manufacturing costs 1,810.00
4.- Cost of materials used 5,400.00
5.- Production and sales:
Types Production sales Sales value.
units units unit S/.
A 600 500 12
B 1,000 800 8

Note: Historical costs are joint costs for A and for B, separate them.
cost elements taking the valuation sheet as a reference
production completed at estimated costs
There was no initial or final inventory, in process
It is requested:

Valuing production and sales at estimated costs

Determine the variation between estimated costs and actual costs using the method of
coefficients
State what the estimated and actual profit or loss is.

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 Teacher: Jorge Romero Guzmán
19/03/2019

Exercises 3.

APPLICATION OF INDIRECT COSTS. General rate, ABC costing rate

Practice 1 CASE LAMPS TYSON SA
The company Lámparas Tyson SA is a producer of quality lamps and has
a plant that produces 2 types of lamps: Classic and Modern. The company has
decided to change the current costing system that is based on volume of
units produced to an activity-based system.
Before making the change, it is necessary to assess the impact on costs of the
products
To evaluate the effect of the change, the following data has been gathered.
Simplicity has only been considered a single process.
Cost Hours of Moving Preparation
Model quantity
cousin machine materials machines
Classic 40,000 80,000 10,000 2,665 100
Moderna 10,000 15,000 2,500 1,335 50
95,000 12,500 4,000 150

The prime costs are broken down into 60% direct materials and 40% direct labor.
indirect costs amount to S / 200,000
By nature according to the Chart of Accounts By activity (ABC perspective)
Factory plant rental S/ 36,000 Material handling S/ 90,000
Supervision salaries include LS 60,000 Prepare machines 60,000
Depreciation of equipment 54,000 Machine work 50,000
Driving force 20,000 200,000
Machine breakage insurance 8,000
Services contracted to third parties 13,000
Indirect materials 9,000
200,000
Under the current system, the CIFs are assigned based on machine hours.
lamps are produced in batches.
The products are sold:
Classic lamp 15 soles
Modern Lamp 20 soles
It is requested:

1. I calculate the costs of lamps based on the volume of units.

2. I calculate the lamp costs based on machine hours.
[Link] entries

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 Teacher: Jorge Romero Guzmán
19/03/2019

APPLICATION OF INDIRECT COSTS: General rate, Departmental rates,

ABC costing rates
Practice 2 GOOD MARK SA CASE
The corporation Good Mark SA is a company that produces cards of 2 types:
scented birthday cards
ordinary cards
The scented cards emit a fragrance when opened.
The production departments are: the cutting department and the
printing The first is responsible for shaping the cards, and the second
of design and literary composition (including the insertion of fragrance for
the flavored cards)
The units are boxes of a dozen cards. The amount of ordinary cards.
It is 10 times more. Two cost objects are worked on in two departments and in
where four activities are identified:
BY NATURE (says what is spent) BY DEPARTMENT (it says where the g
Personnel expenses S/ 300,000 Cutting (shaping the card) 216,000
Printing (design and
Repair and maintenance 150,000 504,000
literary composition
Depreciation of machinery 60,000 720,000
Workshop rental 90,000 BY ACTIVITIES (it says how it is spent)
Contracted services 30,000 Machine Preparation 240,000
Basic services (1) 90,000 Machine work 200,000
720,000 Inspection 160,000
(1) Proporcion de servicios (luz 7 agua 3) Material displacement 120,000
720,000

The statistical information of the products is as follows:

Cards Total Cards
flavored ordinary
Units produced in dozen boxes 20,000 200,000 220,000 units.
Prime costs (70% materials 30% direct labor) 80,000 600,000 680,000 soles
MOD hours
Cut 10,000 150,000 160,000 hs.
Printing 10,000 10,000 20,000 hs.
Total MOD hours 20,000 160,000 180,000 hs.
Machine hours
Court 2,000 8,000 10,000 hs.
Printing 8,000 72,000 80,000 hs.
Total machine hours 10,000 80,000 90,000 hs.
Machine preparation number 60 40 100 times
Inspection hours 2,000 16,000 18,000 hectares.
Number of batch movements 180 120 300 times
Sale value 30 15 soles

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IT IS REQUESTED:

1. Calculate the CIF fee based on the MOD hours for its application
in a production cost statement - simple method
2. Calculate the CIF fee based on departmental fees taking into account
accounts for the fact that the cutting department makes intensive use of MOD and the
The printing department makes intensive use of the machines. To apply.
in a cost of production statement by department.
3. Calculate the CIF fee based on the activities. To apply in a
cost of production statement by activities.

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 Teacher: Jorge Romero Guzmán
19/03/2019

APPLICATION OF INDIRECT COSTS: General rate, Departmental rates, Rates

ABC costing
Practice 3CASESuncalc SA
Suncalc SA is a company that develops 2 products that work with energy.
solar: a pocket calculator and a currency translator used for
convert foreign currency to local currency and vice versa.
Suncalc uses a general rate based on direct labor hours.
to allocate indirect costs.
The company has the following indirect costs of S/. 330,000 that are
they are represented classified in the following way:

BY NATURE (says what is BY DEPARTMENT (where

spending spending
Personnel expenses S/ 100,000 Manufacturing 250,000
Repair and maintenance 80,000 Assembly 80,000
Depreciation of machinery 30,000 330,000
Workshop rental 70,000 FOR ACTIVITIES (it says how it is spent)
Contracted services 10,000 Machine preparation 60,000
Basic services (1) 40,000 Machine work 160,000
330,000 Inspection 60,000
Proportion of services (light 7 water 3) Material displacement 50,000
330,000

The statistical information of the products is as follows:

Translator Calculator Total

pocket coins
Units produced 80,000 90,000 170,000
Direct materials S/. 110,000 130,000 240,000
direct labor S/ 48,000 51,800 99,800
Direct labor hours:
Manufacturing 10,000 10,000 20,000
Assembly 30,000 50,000 80,000
Total MOD hours 40,000 60,000 100,000
Machine hours:
Manufacturing 5,000 15,000 20,000
Assembly 1,000 2,000 3,000
Total machine hours 6,000 17,000 23,000
Number of machine setups 50 30 80
Inspection hours 800 1200 2,000
Number of batch movements 100 80 180
Sale value in soles S/8.00 $10.00

4
It is requested:

Calculate the CIF rate based on the MOD hours for your
application in a production cost state - simple method.
2. Calculate the CIF fee based on departmental fees having
consider that the manufacturing department makes intensive use of
The MOD and the assembly department make intensive use of the machines.
To apply in a cost of production statement by department.
3. Calculate the CIF fee based on the activities. To apply in a
cost of production statement by activities

Adapted from the book Cost Management 5th edition Don R. Hansen

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 Teacher: Jorge Romero Guzmán
19/03/2019
Practice 4
Tropical Juices SAC produces fruit juices, which it sells in containers.
PET (in packs of 20 units). Three types of fruit juices are made from
Orange, passion fruit, and mango.

The purchases for the period are:

Raw materials S/ 760,000 S/ 400,000 and S/ 500,000 (Orange, passion fruit and
mango).
Auxiliary materials 30,000
Supplies 300,000
Spare parts 280,000
The production departments are:
1. Reception and processing of fruits (includes storage in silos
2. Preparation (extraction, clarification, de-aeration, aroma recovery)
3. Cooling and packaging (at 5º C).
Indirect manufacturing costs are classified:
BY NATURE (says what is spent) BY DEPARTMENT (where it is spent)
Auxiliary materials 26,800 Pre-treatment and treatment of fruit 260,000
Supplies 238,600 Preparation 1,064,000
Spare parts 249,600 Cooling and packaging 521,000
indirect labor 320,000 1,845,000
Repair and maintenance 260,000 FOR ACTIVITIES (it says how it is spent)
Depreciation of machinery 160,000 Machine preparation 240,000
Environmental management 150,000 Machine work 1,200,000
Contracted services 280,000 Reception of materials 245,000
Basic services (1) 160,000 Production Planning 160,000
1,845,000 1,845,000
(1)Proporcion de servicios (luz 7 agua 3)

The statistical information of the products is as follows:

CONCEPT Orange Passion Fruit Mango TOTALS

Unidades Producidas (paquetes) 31,000 22,000 9,000
Units Sold 30,000 20,000 8,000
Direct Materials Cost/package S/. 20 15 10
Cost MOD/package S/. 8 10 4
Hours MOD/package 1.5 2 1
Hours. Machine/package 1.5 1 2

6
The Activities and the respective Cost drivers have been analyzed.
TABLE NO. 02
ACTIVIDADES INDUCTORS
1.-PREPARE MACHINES Manufacturing Batch No.
2.- TO MACHINATE. Number of Hours / Machine
3.- RECEPCION DE MATERIALES Nº de Recepciones
4.- PLAN PRODUCTION Order Number of Production
3.- The information presented in table No. 03 has been revealed.
next
FRAME No. 03
CONCEPT Orange Passion fruit Mango
A.- The products were manufactured in batches
5,000 units. 5,000 units. 5,000 units.
of manufacture, each batch contains.
B. The Reception of materials for
15 times 35 times 220 times
each product was
C. The products have been shipped, the
9 times 3 times 20 times
next number of times.
D. The production orders issued
15 orders 10 orders 25 orders
to the plant have been:
In its beginnings, simple costing was applied, assigning its indirect costs.
indirect manufacturing costs) based on man-hours consumed in the
manufacturing of each product.
In a departmental cost system, the following bases are used:
distribution
Pre-treatment and treatment of fruit: Cost of raw material
Preparation : machine hours
Cooling and packaging : Production volume
The possibility of applying ABC Costing is being evaluated, that is to say,
implement a System that is based on Activities, in such a way that
improve the current Traditional Costing System, based on volume of
production. On the other hand, senior management wants to receive a report of
Gains and Losses that illustrate the application of ABC.
The production is sold with a margin over costs of 50%
The operational costs are:
Administration expenses 15,000 (Staff services 60%, Legal fees 30% 10%
office supplies
Gastos de venta 80,000 (fletes 70% seguros, 20% publicidad 10%)
Is requested

1. Calculate the CIF fee in 3 ways (simple, by department and by

activities)
2. Cost of production and sales statement
3. Income Statement