QUESTION TWO

Tengeneze Co Ltd presented the following accounting information relating to its manufacturing activities for the year ended 31/12/2004.

Stock at hand 1 1 - 04

Raw Materials	225,000
W I P	187,500
Finished goods	250,000

Stock at hand at 31/12/2004

Raw materials	310,000
W I P	390,000
Finished goods	470,000

Summaries of transaction during the year

1. Purchases of raw materials Ksh. 1,873,500
2. Payroll for factory wages 1,250,000
3. Factory expenses 2,170,000
4. Sales of finished goods 8,650,000

Expenses for the period

1. Staff salaries
2. Electricity

Required:

Prepare a manufacturing account to show the following.

1. Cost of direct materials used.
2. Prime cost
3. Cost of goods manufactured (10marks)