Prepare a Manufacturing, Trading and Profit and Loss Account for the year ending 28 February 2017.

  100% Pass and No Plagiarism Guaranteed

Prepare a Manufacturing, Trading and Profit and Loss Account for the year ending 28 February 2017.

Management, Control and Accountability for Financial Resources

Discount factors table Year

4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 1 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 2 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.783 0.769 3 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.675 4 0.855 0.823 0.792 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 5 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.593 0.567 0.543 0.519 6 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 7 0.760 0.711 0.665 0.623 0.583 0.547 0.513 0.482 0.452 0.425 0.400 8 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0.351 9 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0.333 0.308 10 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 0.270 11 0.650 0.585 0.527 0.475 0.429 0.388 0.350 0.317 0.287 0.261 0.237 12 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0.286 0.257 0.231 0.208 13 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0.229 0.204 0.182 14 0.577 0.505 0.442 0.388 0.340 0.299 0.263 0.232 0.205 0.181 0.160 15 0.555 0.481 0.417 0.362 0.315 0.275 0.239 0.209 0.183 0.160 0.140 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0.163 0.141 0.123 17 0.513 0.436 0.371 0.317 0.270 0.231 0.198 0.170 0.146 0.125 0.108 18 0.494 0.416 0.350 0.296 0.250 0.212 0.180 0.153 0.130 0.111 0.095 19 0.475 0.396 0.331 0.277 0.232 0.194 0.164 0.138 0.116 0.098 0.083 20 0.456 0.377 0.312 0.258 0.215 0.178 0.149 0.124 0.104 0.087 0.073 21 0.439 0.359 0.294 0.242 0.199 0.164 0.135 0.112 0.093 0.077 0.064 22 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.101 0.083 0.068 0.056 23 0.406 0.326 0.262 0.211 0.170 0.138 0.112 0.091 0.074 0.060 0.049 24 0.390 0.310 0.247 0.197 0.158 0.126 0.102 0.082 0.066 0.053 0.043 25 0.375 0.295 0.233 0.184 0.146 0.116 0.092 0.074 0.059 0.047 0.038 26 0.361 0.281 0.220 0.172 0.135 0.106 0.084 0.066 0.053 0.042 0.033 27 0.347 0.268 0.207 0.161 0.125 0.098 0.076 0.060 0.047 0.037 0.029 28 0.333 0.255 0.196 0.150 0.116 0.090 0.069 0.054 0.042 0.033 0.026 29 0.321 0.243 0.185 0.141 0.107 0.082 0.063 0.048 0.037 0.029 0.022 30 0.308 0.231 0.174 0.131 0.099 0.075 0.057 0.044 0.033 0.026 0.020 31 0.296 0.220 0.164 0.123 0.092 0.069 0.052 0.039 0.030 0.023 0.017 32 0.285 0.210 0.155 0.115 0.085 0.063 0.047 0.035 0.027 0.020 0.015 33 0.274 0.200 0.146 0.107 0.079 0.058 0.043 0.032 0.024 0.018 0.013 34 0.264 0.190 0.138 0.100 0.073 0.053 0.039 0.029 0.021 0.016 0.012 35 0.253 0.181 0.130 0.094 0.068 0.049 0.036 0.026 0.019 0.014 0.010 36 0.244 0.173 0.123 0.088 0.063 0.045 0.032 0.023 0.017 0.012 0.009 37 0.234 0.164 0.116 0.082 0.058 0.041 0.029 0.021 0.015 0.011 0.008 38 0.225 0.157 0.109 0.076 0.054 0.038 0.027 0.019 0.013 0.010 0.007 39 0.217 0.149 0.103 0.071 0.050 0.035 0.024 0.017 0.012 0.009 0.006 40 0.208 0.142 0.097 0.067 0.046 0.032 0.022 0.015 0.011 0.008 0.005 41 0.200 0.135 0.092 0.062 0.043 0.029 0.020 0.014 0.010 0.007 0.005 42 0.193 0.129 0.087 0.058 0.039 0.027 0.018 0.012 0.009 0.006 0.004 43 0.185 0.123 0.082 0.055 0.037 0.025 0.017 0.011 0.008 0.005 0.004 44 0.178 0.117 0.077 0.051 0.034 0.023 0.015 0.010 0.007 0.005 0.003 45 0.171 0.111 0.073 0.048 0.031 0.021 0.014 0.009 0.006 0.004 0.003

Question 1 Merseyside Manufacturing Ltd have extracted the following balances from their books of account at 28 February 2017 Inventory: 1 March 2016 Raw Materials Work in Progress Finished Goods Purchases of Raw Materials Direct Expenses Indirect Wages and Salaries Direct Wages and Salaries Sales Trade Receivables Sales Returns Loan Interest Rent Insurance Office Expenses Buildings (Cost) Provision for depreciation – Buildings Plant and equipment (Cost) Provision for depreciation – Plant and equipment Provision for unrealised profit Bad debts Provision for doubtful debts Loan (10% interest per year) £ 42 500 38 300 52 500 620 000 73 100 41 000 153 200 1 500 000 95 000 4 000 1 200 20 000 2 000 140 500 130 000 26 000 90 000 44 000 2 500 1 100 4 500 24 000 Additional information:

1. Closing inventory on 28 February 2017: Raw Materials £39 300, Work in Progress £37 550 and Finished Goods £78 750.

2. Provision for doubtful debts to be provided at 5% of Trade Receivables.

3. Finished goods are transferred from the factory to the trading account at cost plus 5% on manufacturing.

4. A provision for unrealised profit on the stock of finished goods at 28 February 2017 is to be made of £3 750. 5. Rent is to be apportioned in the ratio 4:1 between the factory and the office. Rent of £5 000 is outstanding at the year end.

6. Insurance is to be apportioned in the ratio 5:1 between the factory and the office. Insurance of £200 is prepaid at the year end. 7. Provision for depreciation: Buildings – 5% on cost – apportioned in the ratio 4:1 between the factory and the office. Plant and equipment – 20% on the written down value – apportioned in the ratio between the factory and the office

REQUIRED: Prepare a Manufacturing, Trading and Profit and Loss Account for the year ending 28 February 2017. Total 25 Marks Answer all questions Management, Control and Accountability for Financial Resources

Question 2 Waterside Production Ltd has provided the following budgeted data for its current financial year. £ Sales 2 900 000 Direct Materials 400 000 Direct Labour 500 000 Production Overheads 1 200 000 Labour Hours 48 000 Machine Hours 60 000 Output in units 400 Job M29852 has been completed. The job sheet shows the following details: Direct Materials £1 100 Direct Labour £3 000 Labour hours used 110 Machine hours used

 a) Calculate the production cost of Job M29852 using each of the following methods: i) Percentage of direct materials

ii) Labour hour rate

iii) Machine hour rate

15 b) Activity based costing is replacing traditional overhead absorption costing methods. Evaluate the limitations of using activity based costing within a business organisation. 

Question 3 Assess the available business options for the presentation of business organisation information and data. Include practical business examples in your response, for example, a balanced scorecard approach.

Question 4 Miffy Ltd manufactures a single product.

The standard cost per unit for January 2017 was:

£ Direct materials £4 per metre 24

Direct labour £14 per metre 49

Variable overheads £7 per labour hour 21

Fixed overheads £5 per labour hour 10

Budgeted production 16 000 units

Budgeted sales 15 000 units at £124 per unit

The actual results for January 2017 were:

£ Sales 14 700 units 1 881 600

Direct materials 92 000

metres 377 200

Direct labour 55 000

hours 786 500

Variable overheads 335 000

Fixed overheads 160 000

Actual production 15 600 units

a) Calculate each of the following variances:

i) Material price variance

2 ii) Material usage variance

2 iii) Labour rate variance

2 iv) Labour efficiency variance

2 v) Total variable overhead variances

2 vi) Total fixed overhead variances

2 b) Prepare a statement that reconciles budgeted and actual sales.

3 c) Assess the benefits and limitations of using a standard costing system in modern business organisations.