Question $3$

A$.$ Crooks' Desk Limited is a small manufacturing company which makes one type of school

desk. They are the sole distributors of school desks in Jamaica. At the end of the accounting

year December $31,2022,$ the following information was available:

Additional information:

Machinery should be depreciated by $20\%$ per annum on cost$.$

Direct factory wages in arrears of $$3,100$ at $31$ December $2022.$

Rent is divided in the ratio $2$:$1$ between factory and the office.

Insurance is divided in the ratio $3$:$1$ between the factory and the office. Insurance was prepaid

by $$300$ at $31$ December $2022.$

During the year $1,481$ office desks were completed.

Required:

i$.$ Prepare a manufacturing account for the year ended $31$ December $2022,$ showing clearly

the cost of raw materials consumed, prime cost and cost of production.

$(9$ marks$)$

ii$.$ Prepare an income statement for the year ended $31$ December $2022.$

$(5$ marks$)$

iii. Calculate the cost of producing one school desk.

B$.$ On March $31,2022,$ the totals of Renny B Enterprise's trial balance failed to agree, the

totals were:

debit $$208,400$

credit $$206,100$

The following errors were discovered:

The payment of electricity $$2,400$ had been correctly entered in the cash book but the entry

had not been posted to the electricity account.

The balance of the rent received account, $$3,800$ had been omitted from the trial balance.

The total of the return inwards joumal had been miscalculated. The correct total was $$21,200$

but the total posted to the return inwards account was $$22,100.$

Required:

Correct the errors by preparing:

i$.$ The general joumal $($NO NARRATION REQUIRED$)$

$(3$ marks$)$

ii$.$ The suspense account