Question

Meduling 1 Header Paragraph 5 - - - - - Question 4 (CLO) The following Trial Balance was prepared from the books of Maxwell Productions Ltd on December 31, 2010 and presented to you the Financial Accountant for analysis: Trial Balance Details Accounts Dr $ Cr$ Insurance 1.200,000 Direct expenses 4,000,000 Bills payable 150,000 Net sales 80,000,000 Office furniture and fittings 4,500,000 Accumulated depreciation on furniture & fittings 900,000 Return outwards of direct raw materials 330,000 Rent 3,000,000 500.000 Bank overdraft 550,000 Direct raw materials purchased 20,330,000 Indirect factory wages 4.000.000 Stock of direct raw materials January 1, 2010 6,500,000 Stationery 1.100.000 Provision for unrealized profit 600,000 Capital 28,940,000 Bad debts 370,000 Provision for bad and doubtful debts 400.000 Production workers salaries | 12,000,000 Cash in hand 1,500,000 Accounts payable 5,600,000 Electricity 2,400,000 Commission 4,800,000 1,000,000 Stock of finished goods January 1, 2010 | 6,600,000 Discounts 800,000 750,000 Carriage inwards of direct raw materials 1,600,000 Administrative salaries 8,400,000 Accounts receivable 9,000,000 Motor vehicles 20.000.000 8.000.000 Provision for depreciation on motor vehicles Work in progress, January 1, 2010 3,500,000 Bills receivable 420,000 Plant and machinery 15,000,000 6.000.000 Accumulated depreciation on plant and machinery Motor vehicles repair cost 700.000 Cash drawings 2.000.000 133,720,000 133,720,000

Answer 1

Manufacturing A/c
For the period ending on 31st December 2010
Dr.					Cr.
Particulars		Amount	Particulars		Amount
Op. stock of raw materials		6,500,000	Cl. Stock Of Work in Progress		4,900,000
Direct Raw Materials	20,330,000		Cl. Stock of Raw materials		5,000,000
Less: Return Outwards	330,000		Cost of Production tfd to Trading A/c		43,023,200
Less: Discounts	750,000
Net Raw Materials		19,250,000
Work In Progress		3,500,000
Production Workers' Salaries		12,000,000
Electricity		1,800,000
Carriage Inwards		1,600,000
Motor Vehicles Repair Cost		420,000
Rent		2,250,000
Depreciation on Plant & Machinery		900,000
Insurance		792,000
Profit on Cost of Production		3,911,200
		52,923,200			52,923,200
Trading A/c
For the period ending on 31st December 2010
Dr.					Cr.
Particulars		Amount	Particulars		Amount
Cost of Production		43,023,200	Manufacturing Profit		3,911,200
Op. Stock of finished goods		6,600,000	Net Sales	80,000,000	79,200,000
Direct Expenses		4,000,000	Less: Discounts	800,000
Gross Profit		37,188,000	Cl. Stock of finished goods		7,700,000
		90,811,200			90,811,200
Profit & Loss A/c
For the period ending on 31st December 2010
Dr.					Cr.
Particulars		Amount	Particulars		Amount
Insurance		528,000	Gross Profit		37,188,000
Rent		750,000
Indirect Factory Wages	4,000,000
Add: Accrued Indirect Factory Wages	180,000	4,180,000
Stationery		1,100,000
Bad Debts	370,000	505,000
Add: Provision for doubtful debts	135,000
Commission	4,800,000
Add: Outstanding Commission	150,000	4,950,000
Administrative Salaries		8,400,000
Motor Vehicles Repair Cost		280,000
Depreciation on Motor Vehicles		2,400,000
Depreciation on Office Furniture		450,000
Electricity		600,000
Net Profit tfd to Balance Sheet		13,045,000
		37,188,000			37,188,000

Balance Sheet
As on 31st December 2010
Assets		Amount
Office Furniture & Fittings		4,500,000
Cash in hand		1,500,000
Accounts Receivable		9,000,000
Motor Vehicles		20,000,000
Bills Receivable		420,000
Plant & Machinery		15,000,000
Closing Stock:		17,600,000
Work in progress	4,900,000
Raw materials	5,000,000
Finished goods	7,700,000
		68,020,000
Liabilities		Amount
Bill Payable		150,000
Accumulated Depreciation on Furniture & fittings		1,350,000
Accumulated Depreciation on Plant & Machinery		6,900,000
Outstanding Rent		500,000
Bank Overdraft		550,000
Provision for unrealised profit		600,000
Capital	28,940,000	26,940,000
Less: Drawings	2,000,000
Provision for Doubtful Debts		535,000
Accounts Payable		5,600,000
Outstanding Commission		1,150,000
Provision for Depreciation on Motor Vehicles		10,400,000
Outstanding Insurance		120,000
Accrued Factory Wages		180,000
Net Profit		13,045,000
		68,020,000