Question

MANUFACTURING ACCOUNTS -REVIEW QUESTIONS QUESTION 1 From the list of balances below, prepare the manufacturing account and Statement of profit or loss for the year ended 31 May 2016; N$ Sales 900 000 Purchases of raw materials 180 000 Direct wages 185 000 Office salaries 169 000 Carriage inwards on raw materials 8 000 Carriage outwards 3 250 Lighting and Rent (80% Factory & 20% Office) 82 000 Insurance (3/4 Factory and 1/4 office) 30 000 Purchases returns of raw materials 1 000 Other information: 1 June 2015 31 May 2016 N$ Inventories figures Material Work-in-progress Finished goods N$ 34 000 20 000 61 000 29 000 17 000 82 000 2. Depreciations for the year are: -Plant & Equipment N$15 000 - Delivery Van N$5 000

Answer 1

Manufacturing account for the year ended 31 st May 2019 Particulars Amount Opening Stock of Raw material 34000 Add Purchase of Raw Material Carriage Inward of Raw Material Less Purchase return of Raw Material 180000 8000 222000 -1000 221000 -29000 192000 Less Closing Stock of Raw material Raw Material Consumed Direct Wages Factory Rent & Lighting (80% of 82000) Factory Insurance (75% of 30000) Depreciation Plant & Machinery Manufacturing Over Heads 185000 65600 22500 15000 288100 Add Opening Stock of WIP 20000 500100 -17000 483100 Less Closing Stock of WIP Cost of Finished Good Manufactured Add Opening Stock of Finished Goods Office Salaries Carriage Outwards Factory Rent & Lighting (20% of 82000) Factory Insurance (25% of 30000) Depreciation Delivery Van 61000 169000 3250 16400 7500 5000 745250 -82000 663250 236750 900000 Less Closing Stock of Finshed Goods Cost of Sales Profit Sales (A-B=C) А

Answer:

Net Profit for the year-end of May 2016 is 2,36,750/-