XYZ Garage consists of 3 departments: Spares, Service and Repairs, each department being managed by a...

 

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XYZ Garage consists of 3 departments: Spares, Service and Repairs, each department being managed by a departmental manager whose commission was respectively 5%, 10% and 10% of the respective departmental profit subject to a minimum of ₹5,000 in each case. Inter departmental transfers take place at a "loaded" price as follows: From Spares to Service 5% above cost From Spares to Repairs 10% above cost From Spares to Service 10% above cost In respect of the year ended March 31st 2019 the firm had already prepared and closed the departmental trading and profit and loss account. Subsequently it was discovered that the closing stocks of department had included inter-departmentally transferred goods at "loaded" price instead of the correct cost price. From the following information, you are required to prepare a statement re-computing the departmental profit or loss: Final Net Profit/Loss (after charging commission) Inter-departmental transfers Included at "loaded" price in Spares 38,000 (Loss) Service ₹ 50,400 (Profit) 65,000 (21,000 from Repairs 72,000 (Profit) 4,202 (from Spares) XYZ Garage consists of 3 departments: Spares, Service and Repairs, each department being managed by a departmental manager whose commission was respectively 5%, 10% and 10% of the respective departmental profit subject to a minimum of ₹5,000 in each case. Inter departmental transfers take place at a "loaded" price as follows: From Spares to Service 5% above cost From Spares to Repairs 10% above cost From Spares to Service 10% above cost In respect of the year ended March 31st 2019 the firm had already prepared and closed the departmental trading and profit and loss account. Subsequently it was discovered that the closing stocks of department had included inter-departmentally transferred goods at "loaded" price instead of the correct cost price. From the following information, you are required to prepare a statement re-computing the departmental profit or loss: Final Net Profit/Loss (after charging commission) Inter-departmental transfers Included at "loaded" price in Spares 38,000 (Loss) Service ₹ 50,400 (Profit) 65,000 (21,000 from Repairs 72,000 (Profit) 4,202 (from Spares)

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