The followingTrial Balance was extracted from the books of General Production Company Ltd onDecember 31, 2011 and presented to you the Financial Accountant:

Question 1 The following Trial Balance was extracted from the books of General Production Company Ltd on December 31, 2011 and presented to you the Financial Accountant: Trial Balance Details/Accounts Dr $ Purchases of direct raw materials 25,200,000 Stock of direct raw materials January 1,2011 5,500,000 Wages paid to manufacture goods 12,000,000 Insurance 2,000,000 Electricity 1,450,000 Cash at bank 28,000,000 Accounts payable Discounts Cr $ 3,500,000 450,000 Return of direct raw materials 500,000 200,000 Cash in hand 600,000 Work-in-progress January 1,2011 3,000,000 Salaries 3,500,000 Returns inward of finished goods 300,000 Carriage inwards of direct raw materials 1,000,000 Indirect raw materials January 1,2011 2,500,000 Accounts receivable 7,500,000 Provision for bad and doubtful debts Machinery 75,000 10,000,000 Accumulated depreciation machinery 4,000,000 Office furniture 2,000,000 Purchase of indirect raw materials 2,500,000 Motor vehicles 14,000,000 Accumulated depreciation motor vehicles Finished goods January 1, 2011 2,800,000 6,000,000 Provision for unrealized profit 1,000,000 Indirect wages 3,000,000 Rent payable 2,400,000 Capital 58,175,000 Stationery 250,000 Bad debts 200,000 Direct expenses 4,000,000 Sales Carriage outwards 70,300,000 2,200,000 Rent receivable Salesmen commission 500,000 1,500,000 141,050,000 141,050,000 Notes: (i)The company adds 20% mark-up to its cost of production. (ii)The provision for bad and doubtful debts is to be increased to 1.5% of debtors. (iii)$200,000 of the insurance relates to 2012. (iv)Rent payable is to be apportioned 75% factory; 25% office. (v)Depreciation is to be charged as follows: Machinery 10% Reducing balance; Motor vehicles 10% Straight line; Office furniture 10% on cost. (vi)On December 31, 2011, $50,000 was outstanding for stationery. (vii)Stocks as at December 31, 2011 were as follows: Direct raw materials, $4,500,000; Work-in-progress, $4,000,000; Finished goods, $4,500,000; Indirect raw materials, $2,000,000 (viii)1/5 of the amount paid for insurance is to be allocated to the office, while 60% of the electricity relates to the factory. (ix)The motor vehicles are used equally between the factory and the office. Required: (a)Prepare Manufacturing, Trading and Profit and Loss Account for the year ending December 31, 2011. (28 marks) (b)A Balance Sheet as at December 31, 2011. (12 marks) END OF QUESTION PAPER