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Solution 3

The document outlines a series of accounting journal entries related to inventory management, costs incurred, and sales transactions. It includes details on raw materials, work in progress (WIP), fixed overheads, and cost of sales. Additionally, it provides workings for various financial figures and calculations related to the inventory and costs involved in the production process.

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13 views4 pages

Solution 3

The document outlines a series of accounting journal entries related to inventory management, costs incurred, and sales transactions. It includes details on raw materials, work in progress (WIP), fixed overheads, and cost of sales. Additionally, it provides workings for various financial figures and calculations related to the inventory and costs involved in the production process.

Uploaded by

gmanmarawu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd

Solution 3

1 Dr Inventory: raw Mat (SOFP)


Cr Bank (SOFP)
Raw Material purchased

2 Dr Inventory: raw Mat (SOFP)


Cr Bank (SOFP)
Transport cost

3 Dr Inventory :WIP (SOFP)


Dr Wages (SOCI)
Cr Bank (SOFP)
Wages paid

4 Dr Salaries and wages (SOCI)


Cr Bank (SOFP)
Salaries paid
5 Dr Gifts
Cr Bank (SOFP)
Gifts paid

6 Dr Inventory :WIP (SOFP)


Dr Head office cost (SOCI)
Cr Bank (SOFP)
Variable cost

7 Dr Fixed Overheads (SOFP


Dr Fixed Overheads (SOFP
Cr Bank (SOFP)
Cr Accumulated Depreciation
Fixed cost incurred

8 Dr Inventory :WIP (SOFP)


Cr Inventory: raw Mat (SOFP)
Raw materials used

9 Dr Inventory :WIP (SOFP)


Cr Fixed Overheads (SOFP
Fixed overheads allocated

10 Dr Cost of sales (SOCI)


Cr Fixed Overheads (SOFP
Fixed overheads expensed

11 Dr Inventory : Finished goods


Cr Inventory :WIP (SOFP)
Finished goods

12 Dr Cost of sales (SOCI)


Cr Inventory : Finished goods
Goods sold

Workings

Raw Mate
OB 20,000
Bank 1,940,000 WIP
Transport 200000 CB
2,160,000

WIP
OB 230,000
VC WIP 4,200,000 Finished goods
VC WIP 1,300,000
Raw Mate 1,944,000
FC 1680000

Finished goods
OB 340000 COS
WIP 9,354,000 CB

Fixed Overheads
Insurance 1,700,000 WIP
Depreciation 400,000 COS
2100 000/500 000= R4.2 per bag

Raw Materials

Expected selling price


Conversion cost
Selling cost
NRV

Write down

Dr Cost of sales (SOCI)


Cr Inventory Raw Materials
NRV write down
Dr Cr
1,940,000 1
1,940,000 1

200,000 1
200,000 1

4,200,000 1
1,800,000 1
6,000,000 1

700,000 1
700,000 1

80,000 1
80,000 1

1,300,000 1
700,000 1
2,000,000 1

1,700,000 1
400,000 1
1,700,000 1
400,000 1

1,944,000 1
1,944,000 1

1,680,000 1
1,680,000 1

420,000 1
420,000 1

9,354,000 1
9,354,000 1
7,755,200 1
7,755,200 1

1944000
216,000
2,160,000

9354000 2

2
7,755,200
1,938,800

1680000 2
420000
1

R216,000 1

300000 1
100000 1
18000 1
182000 1

R34,000 1

34,000 1
34,000 1
45

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