Answer:
Garcon company : cost of production $96,680 cost of good sold $91,030 Gross profit $104,000 Net profit $33,000
Pepper company : cost of production $139,860 cost of good sold $143,010 Gross profit $147,000 Net profit $58,000Explanation:
Garcon. Company
T Account Format
Manufacturing, Trading, Profit and Loss Account
Dr. Cr
$ $
Raw materials. Cost of production transferred
Beginning inventory 7,250. to trading account
Add: purchase 33,000. 96,680
----------
Total materials available 40,250
Less:Ending inventory 5,300
----------
Cost of raw materials consumed 34,950
Add: Direct Labour 19,000
-----------
Prime Cost. 53,950
Factory overhead
Rental cost 27,000
Factory utilities 9,000
Factory supplies used 8,200
Indirect labour 1,250
Repair of factory equipment 4,780
-----------
50,230
Add:Beginning WIP. 14,500
----------
64,730
Less: Ending WIP 22,000
---------
42,730
--------------- ------------------------
Cost of production. 96,680. 96,680
----------------- ---------------------------
Finished good
Beginning inventory 12,000. Sales 195,030
Add: Cost of production 96,680
----------
Goods available for sale 108,680
Less: ending finished good inventory 17,650
-----------
Cost of good sold. 91,030
Gross Profit c/d. 104,000
------------- -----------------
195,030. 195,030
------------------ ----------------------
Expenses
General & Administrative expenses 21,000. Gross Profit b/d 104,000
Selling expenses. 50,000
Net profit. 33,000
------------------ ----------------
104,000 104,000
------------------- -----------------
Pepper company
T Account Format
Manufacturing , Trading, Profit and Loss Account
Dr. Cr
$ $
Raw materials. Cost of production
Beginning inventory 9,000. Transferred to trading Account
Add: purchase. 52,000. 139,860
----------
Total materials available. 61,000
Less: Ending inventory. 7,200
-----------
Cost of raw materials consumed 53,800
Add: Direct Labour. 35,000
-----------
Prime Cost. 88,800
Factory overhead
Rental cost 22,750
Factory utilities 12,000
Factory supplied used 3,200
Indirect labour 7,660
Repair of Factory equipment 1,500
-----------
47,110
Add: Beginning WIP. 19,950
-----------
67,060
Less: Ending WIP. 16,000
-----------
51,060
------------- --------------
Cost of production. 139,860. 139,860
-------------- -----------------
Finished good
Beginninginventory 16,450. Sales 290,010
Add: Cost of production 139,860
--------------
Cost of good available for sale 156,310
Less:Ending inventory 13,300
-------------
Cost of good sold. 143,010
Gross Profit c /d. 147,000
------------ ----------------
290,010. 290,010
-------------- ------------------
Expenses
General &Administrative expenses 43,000. Gross Profit b /d 147,000
Add: Selling expenses. 46,000
----------------
89,000
Net profit 58,000
-------------- -----------------
147,000. 147,000
-------------- -------------------
