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Takers Limited operates separate cost accounting and financial accounting systems. The following manufacturing and trading statement has been extracted from the company's financial accounts for...

      

Takers Limited operates separate cost accounting and financial accounting systems. The following manufacturing and trading statement has been extracted from the company's financial accounts for the quarter ended 31 march 2011
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Additional information:
1. The cost accounts indicated that raw materials issued during the quarter ended 31 March 2011
amounted to sh. 104,800,000
2. As per the cost accounts cost of goods produced and cost of goods sold amounted to sh.
222,500,000 and sh. 212,100,000 respectively
3. Raw materials lost through floods amounted to sh, 2,400,000 Insurance claim for these raw
materials is pending
This claim was reflected in the cost accounts
4. A notional rent of sh. 4,000,000 per month has been charged in the cost accounts
5. Production overheads were absorbed at the rate of 185% of direct wages

Required:
a) Prepare the following control accounts in the cost ledger
i. Raw materials stores
ii. Work in progress
iii. Finished goods
iv. Production overhead
b) A statement reconciling the gross profit as per the cost accounts and the gross profit as per the
financial accounts

  

Answers


Kavungya
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Kavungya answered the question on December 15, 2021 at 10:17


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