2016-MEMO+-+Studiegids+Indiviuele+opdrag

2016-MEMO+-+Studiegids+Indiviuele+opdrag - STUDIEGIDS 2016...

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STUDIEGIDS 2016 – INDIVIDUELE OPDRAG – MEMO TOTAL 80 QUESTION 1 (27) Cost classifications; schedules of cost of goods manufactured and sold; income statement: manufacturer 1.1 Brown’s overdraft facility should not be cancelled as the business has made a substantial profit. The reasons that the profit was reported as a loss are summarised below. (2) 1.2 Corrections to Brown’s reported loss: (7) R Assets recorded as expenses: Factory equipment (net of depreciation) (1 120 000) b Office equipment (net of depreciation) (80 000) c Sales vehicles (net of depreciation) (120 000) d Raw material inventory (200 000) Work in process inventory (400 000) Finished goods inventory (515 000) Total overstatement of expenses R2 435 000 Operating loss as per statement (1 295 000) Overstatement of expenses 2 435 000 Correct gross profit 1 140 000 1
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(b) Factory equipment: acquisition cost 1 400 000 Less depreciation 280 000 Written-down value 1 120 000 (c) Office equipment: acquisition cost 100 000 Less depreciation 20 000 Written down value 80 000 (d) Sales vehicles: acquisition cost 150 000 Less depreciation 30 000 Written-down value 120 000 2
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1.3 (9) Realplay Gyms Company Schedule of cost of goods manufactured Year ended 31 December, 2015 Direct material: R R Raw materials inventory, January 1 0 Add: Purchases of raw materials 2 000 000 Raw material available for use 2 000 000 Less: Raw materials inventory, December 31 200 000 Raw material used 1 800 000 Direct labour 750 000 Manufacturing overhead: Factory supplies 100 000 Indirect labour 100 000 Factory manager’s salary 200 000 Cleaning costs 40 000 Rent 200 000 Electricity 45 000 Depreciation: factory equipment 280 000 Total manufacturing overhead 965 000 Total manufacturing costs 3 515 000 Add: Work in process inventory, January 1 0 Subtotal 3 515 000 Deduct work in process inventory, December 31 400 000 Cost of goods manufactured 3 115 000 3
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1.4 (3) Realplay Gyms Company Schedule of cost of goods sold Year ended 31 December, 2015 R Finished goods inventory, January 1 0 Add: Cost of goods manufactured 3 115 000 Cost of goods available for sale 3 115 000 Less: Finished goods December 31 515 000 Cost of goods sold 2 600 000 1.5
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