2. The following balances were obtained from the books of The Living Gungo as at December 31, 2012: Capital 20,000 Drawings 1,400 Factory machinery 12,000 Equipment 3,000 Provision for dep'n-Factory machinery 2,000 Provision for dep'n-Equipment 400 Purchases of raw material 18,740 Sales 34,170 Returns inwards 250 Returns outwards on raw materials 140 Debtors 7,980 Creditors 4,020 Factory wages 3,520 Factory general expenses 1,080 Direct wages 1,000 Rent & rates 1,410 Insurance 600 Selling & distribution expenses 2,000 Bank overdraft 2,700 Stock at Jan 1: Raw material 3,350 Finished goods 4,430 WIP 1,320 Office salaries 1,350 63,430 63,430 Notes: 1. Closing stock: raw material -4,900; finished goods - 3,404; work in progress - 1,210 2. Rent & rates owing by 90, insurance prepaid by 100, selling and distribution expense owing by 400 3. Provide for depreciation on machinery 10% reducing balance; equipment 10% straight line. Equipment is used equally in the factory and the office 4. Apportion insurance equally, while rent and rates are to be apportioned 2/3 to the factory 5. Goods produced were transferred at a mark up of 15% Required: Prepare the manufacturing account and statement of profit or loss for the year, as well as the statement of financial position as at that date. Additional questions 1. The following balances were obtained for The Corn Barn at December 31, 2015: Direct wages DR CR 45,000 Factory wages 60,000 Admin wages 90,000 Building 700,000 Provision for depreciation on building 70,000 Machinery and equipment 385,000 Provision for depreciation on machinery & equipment 56,000 Motor vehicle 360,000 Provision for depreciation on motor vehicle 48,000 Office expenses 30,000 Direct expenses 20,000 Drawings Commission received 30,000 45,000 Sales Debtors 1,400,000 56,000 Carriage in on raw materials 3,500 Capital 320,000 Bank 45,000 Creditors 22,000 Opening stock raw material 30,000 Opening stock - indirect material 15,300 Opening stock work in progress 24,000 Opening stock finished goods 110,000 Loan 500,000 Insurance 25,000 Purchases of raw materials 410,000 Purchases of indirect materials 50,000 Provision for unrealized profits 2,300 Factory general expenses Utilities 36,500 28,000 2,508,300 2,508,300 End notes: i. Stock on hand at the end of the year: raw materials 45,000; indirect materials 32,000, work in progress 30,500, finished goods 75,000 ii. Provide for depreciation as follows: 10 2. Asset Rate Method Building 10% Reducing balance Machinery and equipment 10% Straight line Motor vehicle 10% Reducing balance Note: All assets are used equally in factory and office. iii. Insurance of 5,000 is owing; while utilities are prepaid by 6,000 iv. The insurance and the utilities are to be shared 60% in the factory and 40% in the office v. The goods produced are to be transferred with a markup of 20% Required: Prepare the manufacturing account and statement of profit or loss, and statement of financial position for the Corn Barn. 11