The following is the trial balance of Limako Lid, a manufacturing outfit, on 31 December, 2019:...

 

 

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The following is the trial balance of Limako Lid, a manufacturing outfit, on 31" December, 2019: N 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 21,000. 13,500 32,900 35,000 370,000 10,500 250,000 25,000 40,000 8,000 31,000 7,500 44,000 30,000 11,500 72,000 12,200 2,300 4,800 5,900 Rent Insurance Bank charges Discount allowed Carriage outwards Sales Accounts Receivables Accounts payables Cash at Bank Cash in Hand 750,000 142,300 125,000 56,800 11,500 20,000 Drawings Capital 316,700 1,224.700 L.224,700 Notes at 31" December 2019: • 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. 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) finished good = N40,000 Question Two i. Exhaustively distinguish between the final accounts of a manufacturing company from that of a trading company Discuss with an illustrative example how common expenses are treated in the final accounts of a manufacturing company (ensure you also include the treatment of i. prepayments and accruals). The following is the trial balance of Limako Lid, a manufacturing outfit, on 31" December, 2019: N 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 21,000. 13,500 32,900 35,000 370,000 10,500 250,000 25,000 40,000 8,000 31,000 7,500 44,000 30,000 11,500 72,000 12,200 2,300 4,800 5,900 Rent Insurance Bank charges Discount allowed Carriage outwards Sales Accounts Receivables Accounts payables Cash at Bank Cash in Hand 750,000 142,300 125,000 56,800 11,500 20,000 Drawings Capital 316,700 1,224.700 L.224,700 Notes at 31" December 2019: • 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. 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) finished good = N40,000 Question Two i. Exhaustively distinguish between the final accounts of a manufacturing company from that of a trading company Discuss with an illustrative example how common expenses are treated in the final accounts of a manufacturing company (ensure you also include the treatment of i. prepayments and accruals).

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Limako Ltd Manufacturing Account for the year ended 31 December 2019 Raw Materials Opening Stock Pur... View the full answer