ASSIGNMENT FOUR (20 Marks) The following trial balance has been extracted from the books Kpogas Furniture Ltd at December 31, 2019, representing the summary of transactions for the financial year. GHC GHC Freehold land and buildings 837,500 Patents 25,000 Factory plants and machinery at cost 562,500 Furniture and fittings at cost 187,500 Motor vehicles at cost 281,250 Accumulated depreciation at December 31, 3018: Plant and machinery 256.875 Fixtures and fittings 59,065 Motor vehicles 93.750 Trade receivables 666,110 Stock of raw materials at January 1, 2019 424,000 Purchases of raw materials 2,727.250 Overdraft interest 39,375 Inventory of work-in-progress 122,815 Administrative expenses 592.875 Selling and distribution cost 418,000 691,875 Inventory of finished goods January 1, 2019 Wages and salaries 937,500 Manufacturing overheads (excluding depreciation) 468,750 Trade Payables 365,624 Bank overdraft 100,000 Rent received 75,000 Sales 6,025,316 Stated Capital 1,000,000 Income surplus: January 1, 2019 660,070 8,568,200 8,568,200 Additional Information a. Freehold land and buildings is analyzed as follows: Land 150,000 Buildings used as business premises 475,000 Investment properties 212,500 The land and buildings were acquired in January 2019. On December 31, 2019, the land and buildings were valued at an opened market valuation by a chartered surveyor at GHC200,000 and GHC500,000 respectively and the directors want these figures be incorporated in the accounts. It was also estimated that the buildings will have useful economic life of 50 years from the date of acquisition. 25% of the land and buildings are used as administration offices and 75% for production. Ignore depreciation of land. The investment property has open market valuation of GHC312,500 according to the chartered surveyor. The rental has been registered at an arm's length with a company which is not related to Kpogas Ltd. . b. Provision should be made for the following: Directors' emoluments of 4,000 Auditors fees of 10,000 Doubtful debts provision of 10% of Trade Receivables Depreciation on Plant & Machinery at 10% on cost, Furniture and fittings at 10% on cost and Motor vehicles at 20% on cost (The furniture and fittings are mainly used in the administration office and Motor vehicles are mainly used for distribution c. Payment of 66,000 was made to GRA on provisional assessment of 2019 tax liability. d. Inventory at December 31, 2019 were valued as follows: Raw material 350,000 Finished goods 1,030,000 Work-in-progress 125,000 The company has authorized capital of 10,000 equity shares of 5,000 shares have been issued and fully paid for. The directors have proposed a dividend of GHC0.60 per share. Required: Prepare the manufacturing, Trading Profit or Loss Account and Income surplus Accounts for the year ended December 31, 2019 and Balance sheet as at that date. ASSIGNMENT FOUR (20 Marks) The following trial balance has been extracted from the books Kpogas Furniture Ltd at December 31, 2019, representing the summary of transactions for the financial year. GHC GHC Freehold land and buildings 837,500 Patents 25,000 Factory plants and machinery at cost 562,500 Furniture and fittings at cost 187,500 Motor vehicles at cost 281,250 Accumulated depreciation at December 31, 3018: Plant and machinery 256.875 Fixtures and fittings 59,065 Motor vehicles 93.750 Trade receivables 666,110 Stock of raw materials at January 1, 2019 424,000 Purchases of raw materials 2,727.250 Overdraft interest 39,375 Inventory of work-in-progress 122,815 Administrative expenses 592.875 Selling and distribution cost 418,000 691,875 Inventory of finished goods January 1, 2019 Wages and salaries 937,500 Manufacturing overheads (excluding depreciation) 468,750 Trade Payables 365,624 Bank overdraft 100,000 Rent received 75,000 Sales 6,025,316 Stated Capital 1,000,000 Income surplus: January 1, 2019 660,070 8,568,200 8,568,200 Additional Information a. Freehold land and buildings is analyzed as follows: Land 150,000 Buildings used as business premises 475,000 Investment properties 212,500 The land and buildings were acquired in January 2019. On December 31, 2019, the land and buildings were valued at an opened market valuation by a chartered surveyor at GHC200,000 and GHC500,000 respectively and the directors want these figures be incorporated in the accounts. It was also estimated that the buildings will have useful economic life of 50 years from the date of acquisition. 25% of the land and buildings are used as administration offices and 75% for production. Ignore depreciation of land. The investment property has open market valuation of GHC312,500 according to the chartered surveyor. The rental has been registered at an arm's length with a company which is not related to Kpogas Ltd. . b. Provision should be made for the following: Directors' emoluments of 4,000 Auditors fees of 10,000 Doubtful debts provision of 10% of Trade Receivables Depreciation on Plant & Machinery at 10% on cost, Furniture and fittings at 10% on cost and Motor vehicles at 20% on cost (The furniture and fittings are mainly used in the administration office and Motor vehicles are mainly used for distribution c. Payment of 66,000 was made to GRA on provisional assessment of 2019 tax liability. d. Inventory at December 31, 2019 were valued as follows: Raw material 350,000 Finished goods 1,030,000 Work-in-progress 125,000 The company has authorized capital of 10,000 equity shares of 5,000 shares have been issued and fully paid for. The directors have proposed a dividend of GHC0.60 per share. Required: Prepare the manufacturing, Trading Profit or Loss Account and Income surplus Accounts for the year ended December 31, 2019 and Balance sheet as at that date