Kaluwax Ltd. manufactures one product which it sells to the wholesale trade. The following trial balance was extracted from the books of the company at 30 December 2021: Sh. Sh. Stocks at 1 January 2020 Raw materials, at cost 350,000 Work- in-progress, at factory cost 1,800,000 Finished goods (3,500 units) at factory cost 3,500,000 Raw materials purchased 3,950,000 Sales (12,000 units) 18,000,000 Manufacturing wages 3,000,000 Factory rent and rates 1,400,000 Factory light, heat and power 655,000 Plant at cost 6,000,000 Plant depreciation at 1 January 2020 2,800,000 Works manager’s salary 245,000 Plant repairs 400,000 Administrative overheads 1,800,000 Factory lease at cost (20 years duration) 4,000,000 Share capital 7,500,000 Debtors 3,050,000 Bank balance 1,600,000 Creditors 3,650,000 Carriage inwards 200,000 _______ 31,950,000 31,950,000 The following additional information is available: Plant depreciation is to be provided at 10% on the cost of plant owned at the year end. Raw materials costing Sh.500, 000 were in stock on 31 december2020. Finished goods are transferred to the warehouse as soon as they are completed. During the year, 10,000 units were completed and transferred to the warehouse. Work-in-progress at the end of the financial year (at factory cost) amounted to Sh.2, 300,000. Required: Manufacturing, trading and profit and loss account for the year ended 31 December 2021. Prepare the statement of financial position as at the date You have been appointed to be an accountant of Jane a sole proprietor, the information provided as at 30th June 2021 is not complete. Discuss some of the reasons that can contribute to lack of adequate records.

Kaluwax Ltd. manufactures one product which it sells to the wholesale trade. The following trial balance was extracted from the books of the company at 30 December 2021: Sh. Sh. Stocks at 1 January 2020 Raw materials, at cost 350,000 Work- in-progress, at factory cost 1,800,000 Finished goods (3,500 units) at factory cost 3,500,000 Raw materials purchased 3,950,000 Sales (12,000 units) 18,000,000 Manufacturing wages 3,000,000 Factory rent and rates 1,400,000 Factory light, heat and power 655,000 Plant at cost 6,000,000 Plant depreciation at 1 January 2020 2,800,000 Works manager’s salary 245,000 Plant repairs 400,000 Administrative overheads 1,800,000 Factory lease at cost (20 years duration) 4,000,000 Share capital 7,500,000 Debtors 3,050,000 Bank balance 1,600,000 Creditors 3,650,000 Carriage inwards 200,000 _______ 31,950,000 31,950,000 The following additional information is available: Plant depreciation is to be provided at 10% on the cost of plant owned at the year end. Raw materials costing Sh.500, 000 were in stock on 31 december2020. Finished goods are transferred to the warehouse as soon as they are completed. During the year, 10,000 units were completed and transferred to the warehouse. Work-in-progress at the end of the financial year (at factory cost) amounted to Sh.2, 300,000. Required: Manufacturing, trading and profit and loss account for the year ended 31 December 2021. Prepare the statement of financial position as at the date You have been appointed to be an accountant of Jane a sole proprietor, the information provided as at 30th June 2021 is not complete. Discuss some of the reasons that can contribute to lack of adequate records.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Kaluwax Ltd. manufactures one product which it sells to the wholesale trade. The following trial balance was extracted from the books of the company at 30 December 2021:

	Sh.	Sh.
Stocks at 1 January 2020
Raw materials, at cost	350,000
Work- in-progress, at factory cost	1,800,000
Finished goods (3,500 units) at factory cost	3,500,000
Raw materials purchased	3,950,000
Sales (12,000 units)		18,000,000
Manufacturing wages	3,000,000
Factory rent and rates	1,400,000
Factory light, heat and power	655,000
Plant at cost		6,000,000
Plant depreciation at 1 January 2020		2,800,000
Works manager’s salary	245,000
Plant repairs		400,000
Administrative overheads	1,800,000
Factory lease at cost (20 years duration)	4,000,000
Share capital		7,500,000
Debtors	3,050,000
Bank balance	1,600,000

Creditors		3,650,000
Carriage inwards	200,000	_______
	31,950,000	31,950,000

The following additional information is available:

Plant depreciation is to be provided at 10% on the cost of plant owned at the year end.
Raw materials costing Sh.500, 000 were in stock on 31 december2020.
Finished goods are transferred to the warehouse as soon as they are completed. During the year, 10,000 units were completed and transferred to the warehouse. Work-in-progress at the end of the financial year (at factory cost) amounted to Sh.2, 300,000.

Required:

Manufacturing, trading and profit and loss account for the year ended 31 December 2021.

Prepare the statement of financial position as at the date

You have been appointed to be an accountant of Jane a sole proprietor, the information provided as at 30^th June 2021 is not complete. Discuss some of the reasons that can contribute to lack of adequate records.

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