Reference no: EM133051554
Question - Ultimate Sounds Ltd manufactures and sells a new line of electric guitars. Unfortunately, it suffered serious fire damage at its accounting office and, as a result, the accounting records for March 2021 were partially destroyed. The company has hired you to help figure out the missing pieces of the accounting information. The following accounts have been retrieved for the month of March 2021.
Debit Credit
Finished Goods, 1 March 36,100
Work in Process, 1 March 12,500
Raw Materials, 1 March 8,200
Prepaid Rent 40,500
Accounts Payable 27,000
Share Capital 70,000
Retained Earnings 55,500
Work in Process, 31 March 45,800
Freight Inwards 1,750
Sales Revenue 1,249,500
Discount Allowed 7,200
Direct Materials used during month of March 385,900
Freight Outwards 9,300
Direct Labour 360,500
Raw Materials Purchases 390,800
Indirect Labour 120,600
Gross Profit 390,280
Plant Energy Costs 69,230
Insurance Expense (40% for manufacturing building, 60% for office building) 99,450
Electricity and Gas Expense (70% belongs to production) 45,000
Plant Manager Salary 42,450
Administrative Salaries Expenses 65,080
Interest Expense 28,100
Machinery Depreciation Expense 25,800
Depreciation Expense - Sales Office 27,000
Required -
a) Prepare the Costs of Goods Manufactured statement for the month ended 31 March 2021.
b) Calculate the following amounts (Show all workings):
1. Cost of Sales
2. Net profit for the month of March
3. Ending finished goods Inventory