The following information appeared in the accounting records of Erfurt Enterprises, a manufacturing entity, at 29 February 2020, the end of the financial year. Extract from the trial balance as at 29 February 2020: N$ Inventory on hand 1 March 2019 Raw materials 160 650 Work-in-progress 229 500 Finished products 469 200 Raw material purchased (including N$52 326 indirect material) 511 326 Raw materials issued to production ? Air freight paid on raw material purchased in the Congo 163 200 Indirect materials additionally issued to production 6 426 Insurance expenses (including N$8 415 for office insurance) 30 294 Depreciation (10:3 ratio applicable for manufacturing equipment and office furniture respectively) 39 780 Rent expenses (60% of the rent was paid for the factory premises) 84 150 Wages and salaries paid 336 600 Water and electricity (N$272 646 included for the factory water & electricity) 321 453 Sales during the year 1 530 000 Additional information: 1. Inventory is valued on the FIFO (First-in-First-Out) method. 2. Inventory on hand – 29 February 2020: N$ Raw materials 387 090 Work-in-progress 535 041 Finished products 532 440 3. Products are transferred to the sales department at cost plus 15%. 4. 30% of salaries and wages represent indirect labour cost of which N$39 780 was paid to the factory supervisor. The rest of the salaries and wages relate to direct labourers. 5. All indirect materials issued were used in the production process. The raw material account in the general ledger contains both the receipt and issue of direct and indirect material. 6. At 1 March 2019, the allowance for the unrealised profit in finished products inventory amounted to N$61 200. 7. The remainder of the insurance expense relates to the insurance on the factory equipment. How to prepare the following accounts in the general ledger: Finished goods inventory Allowance for unrealised profit Manufacturing profit
The following information appeared in the accounting records of Erfurt Enterprises, a manufacturing entity, at 29 February 2020, the end of the financial year. Extract from the
How to prepare the following accounts in the general ledger:
Finished goods inventory
Allowance for unrealised profit
Manufacturing profit
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