Reference no: EM132555692

Question 1: Create a manufacturing account and statement of profit

Or loss for the year ending 31 December 2016 and a statement of financial position as at 31 December2016 for J. Jones Limited.

Make provision for the following:

i) Inventory in hand at 31 December 2016:

Raw materials £25,000

Work-in-progress £11,000

Finished goods £26,000.

ii) Depreciation of 10% on plant and machinery using the straight line method.

iii) 80% of fuel and light and 75% of rent and rates to be charged to manufacturing.

iv) Allowance for doubtful debts: 5% of sundry accounts receivable.

v) £4,000 outstanding for fuel and light.

vi) Rent and business rates paid in advance: £5,000.

vii) Market value of finished goods: £382,000.