The following schedule of balances was extracted from the accounting records of STR Manufacturing limited as at
Question:
The following schedule of balances was extracted from the accounting | ||
records of STR Manufacturing limited as at 31st August 2021. | ||
Kshs | ||
Stock as at September 1st 2020 | ||
Raw Material | 13,550 | |
Work in Progress | 6,500 | |
Finished Goods | 12,800 | |
Purchases and Expenses for the Year ending 31st August 2021. | ||
Kshs | ||
Raw Materials | 237,650 | |
Indirect Materials | 1,850 | |
Direct Wages | 53,230 | |
Factory Power | 4,550 | |
Factory Heating and Lighting | 1,975 | |
office heating and lighting | 930 | |
printing and stationery | 1,264 | |
postage and telephone | 520 | |
factory salaries | 11,500 | |
office salaries | 9,900 | |
factory insurance | 1,210 | |
other insurance | 450 | |
Depreciation: | ||
factory equipment & machinery | 5,000 | |
office equipment & machinery | 650 | |
office expenses | 1,680 | |
advertising | 850 | |
Sales of manufactured produce to 31.08.2021 | 378,150 | |
the following additional information is relevant to the above accounting period. | ||
1. Finished goods manufactured during the accounting period are transferred from the factory at a manufacturing price of cost of production plus 10% | ||
2. Stock as at August 2021 | Kshs | |
Raw Material | 240,000 | |
Work in Progress | 7,987 | |
Finished Goods | 18,050 | |
3. Prepayments as at 31st August 2021 | ||
factory insurance | 116 | |
other insurance | 45 | |
4. Accruals | ||
Direct Wages | 1,342 | |
Factory Heating and Lighting | 197 | |
office heating and lighting | 43 | |
Factory Power | 350 | |
Required: | ||
i. Manufacturing Account for the Period ending August 31st 2021. (8 mks) | ||
ii. Trading Account for the Period ending August 31st 2021. (6 mks) | ||
iii. Profit and Loss Account for the Period ending August 31st 2021. (6 mks) |
Advanced Accounting
ISBN: 978-0538480284
11th edition
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng