Reference no: EM132562067

The following information has been taken from the accounting records of LATIF MANUFACTURING COMPANY:

Inventories (Jan. 01, 2004)

Raw Material ................ Rs. 27,300

Goods-in-Process ......... Rs. 16,200

Finishes goods ............. Rs. 24,100

Inventories (Mar. 31, 2004)

Items ......... Raw Material ...... Goods-in-Process ....... Finished Goods

Material .......... 29,050 ................... 6,450 ....................... 21,750

Labour ....................................... 2,100 ...................... 13,500

Overhead ...................................... ? ......................... 10,800

TOTAL ........... 29,050 ................... ? ........................ 46,050

Data for the three months ended on March 31, 2004

Cost of Good Manufactured ............................ Rs. 4,06,440

Factory Overhead ......................................... Rs. 89,200

The company also paid transportation costs on materials purchased of Rs. 13,850 it received credit of Rs. 8,150 for materials returned to suppliers.

Required:

Question a) On the basis of the above information and the missing data, which can be derived from it, prepare a statement of cost of good manufactured for the three months ended on March 31, 2004.

Question b)

If Finished goods ending increases by Rs. 5000 what affect will be on Net Profit

If Finished goods ending decreases by Rs. 5000 what affect will be on Net Profit