XY Limited commenced trading on 1 February with fully paid issued share capital of 500 000, Fixed
Question:
2. Wages incurred for all staff were £675 000, represented by cash paid £500 000 and wage deductions of £175 000 in respect of income tax etc.
3. Payments were made by cheque for the following overhead costs:
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4. Issues of raw materials were £180 000 to Department A, £192 500 to Department B and £65 000 for production overhead items.
5 Wages incurred were analyzed to functions as follows:
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6 Production overhead absorbed in the period by Department A was £110 000 and by Department B £120 000.
7 The production facilities, when not in use, were patrolled by guards from a security firm and £26 000 was owing for this service. £39 000 was also owed to a firm of management consultants which advises on production procedures; invoices for these two services are to be entered into the accounts.
8 The cost of finished goods completed was
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Sales on credit were £870 000 and the cost of those sales was £700 000.
10 Depreciation of productive plant and equipment was £15 000.
11 Cash received from debtors totaled £520 000.
12 Payments to creditors were £150 000.
You are required:
(a) To open the ledger accounts at the commencement of the trading period;
(b) Using integrated accounting, to record the transactions for the three months ended 30 April;
(c) To prepare, in vertical format, for presentation to management,
(i) A profit statement for the period;
(ii) The balance sheet at 30 April.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
a and b c i Profit statement for the period 1 February to 30 April ii ...View the full answer
