Closing Inventories – NBC Institute

FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

Question

The trial balance for United Nigeria Plc as at December 31, 2020 is given below:

Additional information:

Inventories at the end of the year were N120,000,000. Included in the closing inventories was a damaged item with a cost of N30,000,000, which has a net realizable value of N18,000,000.
Additional ordinary shares of 50,000,000 were issued and fully paid for at 80 kobo per share, which is yet to be recorded.
Interest on 10% loan notes is outstanding and dividend on 12% preference shares were paid on December 31, 2020. Ordinary shareholders were also paid a dividend of 5 kobo per share.
Allowances for trade receivables are to be increased to 15% per annum. Depreciation is charged on plant and equipment at 15% on reducing balance.
N5,000,000 administrative expenses were outstanding, and N25,000,000 company income tax is estimated for the year. Depreciation is charged to administrative expenses.

You are required to prepare the following:

a. (i) Statement of Comprehensive Income for United Nigeria Plc for the year ended December 31, 2020. (10 Marks)
(ii) Statement of Changes in Equity for the year ended December 31, 2020. (5 Marks)
(iii) Statement of Financial Position as at December 31, 2020. (10 Marks)

Answer

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Topic: Presentation of Financial Statements (IAS 1)
Series: NOV 2021

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

Question

Emeka produces and distributes “Zobo” and has provided you with the following information for the year ended 31 December 2012:

Office rent and rates: N681,000
Inventories at 1 January 2012:
- Raw materials: N6,375,000
- Work-in-progress: N3,750,000
- Finished goods: N4,500,000
Manufacturing wages: N14,100,000
Revenue: N42,000,000
Carriage on raw materials: N210,000
General expenses: N3,375,000
Carriage on sales: N375,000
Discount allowed: N300,000
Discount received: N420,000
Depreciation of factory machinery: N675,000
Purchase of raw materials: N22,500,000
Factory overhead expenses: N6,000,000
Selling and distribution cost: N6,750,000
Office salaries: N3,975,000
Royalty: N1,500,000

Additional information:

Inventories at 31 December 2012:
- Raw materials: N4,875,000
- Work-in-progress: N5,235,000
- Finished goods: N6,000,000

You are required to:
Prepare the statement of profit or loss for the year ended 31 December 2012.

Answer

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Tags: Accounting Adjustments, Closing Inventories, Financial Statements, Manufacturing Accounts, Profit or Loss Statement
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2013

FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

Question

The trial balance for United Nigeria Plc as at December 31, 2020 is given below:

Additional information:

Inventories at the end of the year were N120,000,000. Included in the closing inventories was a damaged item with a cost of N30,000,000, which has a net realizable value of N18,000,000.
Additional ordinary shares of 50,000,000 were issued and fully paid for at 80 kobo per share, which is yet to be recorded.
Interest on 10% loan notes is outstanding and dividend on 12% preference shares were paid on December 31, 2020. Ordinary shareholders were also paid a dividend of 5 kobo per share.
Allowances for trade receivables are to be increased to 15% per annum. Depreciation is charged on plant and equipment at 15% on reducing balance.
N5,000,000 administrative expenses were outstanding, and N25,000,000 company income tax is estimated for the year. Depreciation is charged to administrative expenses.

You are required to prepare the following:

Answer

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Topic: Presentation of Financial Statements (IAS 1)
Series: NOV 2021

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

Question

Emeka produces and distributes “Zobo” and has provided you with the following information for the year ended 31 December 2012:

Office rent and rates: N681,000
Inventories at 1 January 2012:
- Raw materials: N6,375,000
- Work-in-progress: N3,750,000
- Finished goods: N4,500,000
Manufacturing wages: N14,100,000
Revenue: N42,000,000
Carriage on raw materials: N210,000
General expenses: N3,375,000
Carriage on sales: N375,000
Discount allowed: N300,000
Discount received: N420,000
Depreciation of factory machinery: N675,000
Purchase of raw materials: N22,500,000
Factory overhead expenses: N6,000,000
Selling and distribution cost: N6,750,000
Office salaries: N3,975,000
Royalty: N1,500,000

Additional information:

Inventories at 31 December 2012:
- Raw materials: N4,875,000
- Work-in-progress: N5,235,000
- Finished goods: N6,000,000

You are required to:
Prepare the statement of profit or loss for the year ended 31 December 2012.

Answer

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Tags: Accounting Adjustments, Closing Inventories, Financial Statements, Manufacturing Accounts, Profit or Loss Statement
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2013

Question Tag: Closing Inventories

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FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

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Question Tag: Closing Inventories

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FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

You're reporting an error for "FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)"

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

You're reporting an error for "FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation"

FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)

Prepare the financial statements of United Nigeria PLC including comprehensive income, changes in equity, and financial position as of December 31, 2020.

You're reporting an error for "FR – Nov 2021 – L2 – Q1a – Presentation of Financial Statements (IAS 1)"

FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation

Preparation of a statement of profit or loss for Emeka's business.

You're reporting an error for "FA – Nov 2013 – L1 – SB – Q3 – Financial Statements Preparation"

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Customer

Get In Touch

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