4.1. Capital and revenue expenditure and receipts
A subsection of Accounting, 7707, through 4. Accounting procedures
Listing 10 of 85 questions
The following information was provided by G Limited, a manufacturing company, for the year ended 31 March 2024. $ Purchases: Raw materials 68 000 Finished goods 32 413 Wages: Factory operatives 183 700 Factory supervisors 47 200 Administration salaries 34 925 Factory machinery at cost 247 000 Provision for depreciation of factory machinery 51 500 Factory general expenses 20 250 Rates & insurance 7 100 Administration expenses 5 470 Carriage on purchases of finished goods 2 180 Royalties 3 240 1 April 2023 31 March 2024 $ $ Inventory: Raw materials 18 200 19 280 Work in progress 23 400 22 650 Finished goods 6 820 9 350 Additional information Factory machinery is to be depreciated at 15% per annum using the reducing balance method. On 31 March 2024 rates, $620, were owing. Rates and insurance are to be apportioned 60% to the factory and 40% to the office. REQUIRED Prepare the manufacturing account for the year ended 31 March 2024. G Limited Manufacturing account for the year ended 31 March 2024 $ $ G Limited apply a standard rate of mark-up of 35%. REQUIRED: Prepare the trading section of the income statement of G Limited for the year ended 31 March 2024. G Limited Income Statement (Trading section) for the year ended 31 March 2024 $ $ G Limited make all sales on credit and have supplied the following information: Trade receivables turnover Irrecoverable debts $ At 31 March 2024 32 060 At 1 April 2023 19 200 The directors of G Limited are worried about the level of debts from credit customers and are considering employing a consultant to review their credit control policy and implement any changes. They would provide training to the existing staff in the new procedures. The consultant would charge a fee of $14 000 for their services. REQUIRED: Advise G Limited whether to employ the consultant to review their credit control policy. Justify your answer with two advantages and two disadvantages.
7707_w24_qp_23
THEORY
2024
Paper 2, Variant 3
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Questions Discovered
85