Rgel Company manufactures rattan furniture sets for export, using the job order cost system in accounting for its costs. For the year ended December 31, 2020, you obtained from the corporations books the following:Total Manufacturing costs P 2, 500, 000Cost of goods manufactured 1, 800, 000Finished Goods, Dec. 31, 2020 500, 000Direct labor 700, 000 Work in process, January 1, 2020 is 25% less than the work in process, December 31, 2020. How much are goods put into process?

INTRODUCTION TO COST ACCOUNTING

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Rgel Company manufactures rattan furniture sets for export, using the job order cost system in accounting for its costs. For the year ended December 31, 2020, you obtained from the corporation’s books the following:Total Manufacturing costs P 2, 500, 000Cost of goods manufactured 1, 800, 000Finished Goods, Dec. 31, 2020 500, 000Direct labor 700, 000 Work in process, January 1, 2020 is 25% less than the work in process, December 31, 2020. How much are goods put into process?

A	P4, 600, 000
B	P2, 800, 000
C	P2, 100, 000
D	P1, 800, 000

Explanation:

Detailed explanation-1: -The purchase of raw materials should be recorded as a debit to the Raw Materials inventory account in a job order cost system. The raw materials account increases when raw materials are purchased and decrease when materials are issued to the manufacturing process.

Detailed explanation-2: -The three general categories of costs included in manufacturing processes are direct materials, direct labor, and overhead.

Detailed explanation-3: -Companies in the white-collar sector of business, including law firms, accounting businesses, and private investment companies, can utilize job order costing to manage individual client accounts. For example, accounting firms can consider each individual client a job.

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