Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
The following is the trial balance of Limako Ltd, a manufacturing outfit, on 31st December, 2019: NN Inventory (1/1/19): Raw material Work-in-progress Finished goods Direct
The following is the trial balance of Limako Ltd, a manufacturing outfit, on 31st December, 2019: NN Inventory (1/1/19): Raw material Work-in-progress Finished goods Direct Wages Purchase of raw materials Carriage inwards Plant and Machinery Accumulated depreciation Admin. Office Equipment Accumulated Depreciation General office expenses Lighting Administrative salaries Sales reps. salaries Sales reps. commission Rent Insurance Bank charges Discount allowed Carriage outwards Sales Accounts Receivables Accounts payables Cash at Bank Cash in Hand Drawings Capital Notes at 31st December 2019: 21,000 13,500 32,900 35,000 370,000 10,500 250,000 40,000 31,000 7,500 44,000 30,000 11,500 72,000 12,200 2,300 4,800 5,900 142,300 56,800 11,500 20,000 1,224,700 25,000 8,000 750,000 125,000 316,700 1,224,700 Inventory: Raw material = N24,000; WIP = 15,000 and Lighting, rent and insurance are to be apportioned between the factory and administration in the ratio 2:1 Accrued administrative salaries was N2000 Prepaid insurance amounted to N3,200 Provision for Doubtful debt to be 5% of Accounts receivables Depreciation on Plant and Machinery is 10% per annum on cost, while Office equipment is 20% on cost. finished good = N40,000 Required: i. Prepare the manufacturing, trading, and profit or loss accounts as at end of the period and ii. A statement of financial position as at 31st December 2019. (Show all workings) Question Two i. Exhaustively distinguish between the final accounts of a manufacturing company from that of a trading company ii. Discuss with an illustrative example how common expenses are treated in the final accounts of a manufacturing company (ensure you also include the treatment
The following is the trial balance of Limako Ltd, a manufacturing outfit, on 31st December, 2019: NN
Inventory (1/1/19):
Raw material Work-in-progress Finished goods
Direct Wages
Purchase of raw materials Carriage inwards
Plant and Machinery Accumulated depreciation Admin. Office Equipment Accumulated Depreciation General office expenses Lighting
Administrative salaries Sales reps. salaries Sales reps. commission Rent
Insurance
Bank charges Discount allowed Carriage outwards Sales
Accounts Receivables Accounts payables Cash at Bank
Cash in Hand Drawings
Capital
Notes at 31st December 2019:
21,000 13,500 32,900 35,000
370,000 10,500 250,000
40,000
31,000 7,500 44,000 30,000 11,500 72,000 12,200 2,300 4,800 5,900
142,300
56,800 11,500 20,000
1,224,700
25,000 8,000
750,000 125,000
316,700 1,224,700
Inventory: Raw material = N24,000; WIP = 15,000 and
Lighting, rent and insurance are to be apportioned between the factory and administration
in the ratio 2:1
Accrued administrative salaries was N2000
Prepaid insurance amounted to N3,200
Provision for Doubtful debt to be 5% of Accounts receivables
Depreciation on Plant and Machinery is 10% per annum on cost, while Office equipment
is 20% on cost.
finished good = N40,000
Required:
i. Prepare the manufacturing, trading, and profit or loss accounts as at end of the period and
ii. A statement of financial position as at 31st December 2019. (Show all workings)
Question Two
i. Exhaustively distinguish between the final accounts of a manufacturing company from
that of a trading company
ii. Discuss with an illustrative example how common expenses are treated in the final
accounts of a manufacturing company (ensure you also include the treatment
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started