NFL Inc. produces sport’s equipment made to customer’s specifications. The following data pertain to Job
101.
6-month ending June 30, 2016 6-month ending 12/31/2016
Materials – Dept. 1 P100,000 P200,000
Direct Labor rate – Dept. 1 P10/hour P15/hour
Labor hours used – Dept. 1 4,000 hours 2,000 hours
Direct labor rate – Dept. 2 P20/hour P30
Labor hours used – Dept. 2 1,000 hours 3,000 hours
Machine hours used – Dept. 2 2,000 hours 1,000 hours
Additional data:
a. NFL Inc. determined that the amount of operating expenses is 10% of full production cost of job.
b. The company has provided a net profit mark up of 20% based on sales.
c. Applied factory overhead:
Department 1 P5.00 per direct labor hour
Department 2 P2.00 per machine hour
What is the net profit if Job 101 was completed and sold in year 2016?