JOB COSTING SYSTEM. ABC limited commenced trading on 1 February with fully paid issued share capital of 500 000, fixed assets of 275000 and cash at bank of 225 000. by the end of April, the following transactions had taken place: 1. purchases on credit from suppliers amounted to R572500 of which R525000 was raw materials and 47500 was for items classified as production overhead. 2. wages incurred for all staff were R675 000, represented by cash paid R500 000 and wages deductions of R175 000 in respect of income tax, ect. 3. payments were made for the following overhead costs:

production R20 000 selling R40 000 administration R25 000

4. issues of raw materials were 180 000 to department A, R192500 to department B and R65 000 for production overhead items. 5. wages incurred were analysis to functions as follows: work in progress- department A R300 000 work in progress - department B R260 000 production overhead. R42500 selling overhead R47500 administration overhead. R25 000 R675 000 6. Production overhead absorbed in the period by department A was R110 000 and by department B R120 000. 7. The production facilities, when not in use, were patrolled by guards from security firm and R26 000 was owing for this service. 39 000 was also owed to a firm of management consultants which advises on production procedures: invoiced for these two services are to be entered into accounts. 8. The cost of finished goods completed was: depart A. depart B DL. 290 000. 255 000 DM. 175 000. 185 000 P.Overhead 105000. 115 000 total. 570 000. 555000

9. sales on credit were 870 000 and the cost of those sales was 700 000. 10. depreciation of productive plant and equipment was 15 000. 11. cash received from debtors totalled 520 000. 12. payments to creditors were 150 000.

Required. a. open the ledger accounts at the commencement of the trading period. b. using integrated accounting, record the transactions for the three months ended 30 April. c. prepare, in vertical format, for presentation to management, (i) a profit statement for period; (ii) the balance sheet at 30April