Manufacturing Account Question

The following information appeared in the books of Gallore Limited for the year ended December 31, 2022.

Inventories at January 1, 2022

Raw Material 75,000

Work-In-Progress 12,000

Finished Goods 36,000

Other Information:

Production wages 89,000

Factory managers salary 18,000

Depreciation of factory building 5,000

Direct Materials purchased 158,000

Freight on raw materials 4,500

Electricity 25,000

Sales 405,000

Inventory at December 31, 2022:

Raw Material 52,000

Work-In-Progress 17,000

Finished Goods 23,000

75% of electricity is charged to the factory.

Mark-up on production cost is 20%.

Calculate and show clearly

(i) Prime Cost

(ii) Total factory overheads

(iii) Total production cost of goods completed

(iv) Market Value of Finished goods

(v) Cost of goods sold

(vi) Gross Profit

(vii) Net Profit

(viii) Explain the term factory profit and state clearly how it is to be treated in the Income Statement and Balance Sheet.

Note: A manufacturing statement is not required.