Raw Materials – NBC Institute

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

Question

The following is given in relation to raw materials:

O = Opening Inventory
P = Purchases
R = Purchases returns
C = Carriage
E = Excise duties
I = Import duties
Z = Closing Inventory

The cost of raw materials available for use is:

A. O + P + C
B. O + P + E + C – Z
C. O + P + C + I – R
D. O + P + C + R – Z
E. O + P + C – R

Answer

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Tags: Cost Calculation, Inventory, Raw Materials
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2012

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

Question

Ebuka and Sons Enterprises is a manufacturing business entity that imports some of its raw materials from overseas. The business recently took delivery of some materials as detailed below:

2,000kg of materials at ₦625 per kg subject to a trade discount of 5%.
Import duties and other non-recoverable taxes paid amounted to ₦266,000.
A 3% early payment discount allowance enjoyed by the enterprise amounted to ₦37,500.
Delivery cost on materials imported from the custom warehouse to the production plant is ₦125,000.
3,500kg of local materials at ₦250 per kg subject to a trade discount of ₦50,000.
Carriage inwards on local materials purchased was ₦205,000.
Special toll fare paid to the commodity board for local materials purchased was ₦25,000.

Required:
i. Calculate the total cost of inventory of raw materials. (3 Marks)
ii. It is estimated that these materials can produce 5,000 units of the finished product. Calculate the material cost per unit of the finished product. (2 Marks)

Answer

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Tags: Cost Calculation, Inventory Valuation, Raw Materials, Trade Discount
Level: Level 1

Topic: Inventory
Series: NOV 2021

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

Question

According to section (38) of the Value Added Tax Act, 2013 (Act 870), the Minister may by legislative instrument make regulations to grant relief from tax on taxable imports of goods or taxable supplies of goods acquired in the country to the persons specified in the Third Schedule.

Required:
State FOUR (4) conditions that must be satisfied by VAT-registered manufacturing companies before they are granted upfront relief of VAT and levies on imported raw materials. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Manufacturing, Raw Materials, Tax law, VAT Act 2013, VAT Relief
Level: Level 2

Topic: Value-Added Tax (VAT), Customs, and Excise Duties
Series: DEC 2023

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

Question

The following is given in relation to raw materials:

O = Opening Inventory
P = Purchases
R = Purchases returns
C = Carriage
E = Excise duties
I = Import duties
Z = Closing Inventory

The cost of raw materials available for use is:

A. O + P + C
B. O + P + E + C – Z
C. O + P + C + I – R
D. O + P + C + R – Z
E. O + P + C – R

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Inventory, Raw Materials
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2012

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

Question

Ebuka and Sons Enterprises is a manufacturing business entity that imports some of its raw materials from overseas. The business recently took delivery of some materials as detailed below:

2,000kg of materials at ₦625 per kg subject to a trade discount of 5%.
Import duties and other non-recoverable taxes paid amounted to ₦266,000.
A 3% early payment discount allowance enjoyed by the enterprise amounted to ₦37,500.
Delivery cost on materials imported from the custom warehouse to the production plant is ₦125,000.
3,500kg of local materials at ₦250 per kg subject to a trade discount of ₦50,000.
Carriage inwards on local materials purchased was ₦205,000.
Special toll fare paid to the commodity board for local materials purchased was ₦25,000.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Inventory Valuation, Raw Materials, Trade Discount
Level: Level 1

Topic: Inventory
Series: NOV 2021

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

Question

Required:
State FOUR (4) conditions that must be satisfied by VAT-registered manufacturing companies before they are granted upfront relief of VAT and levies on imported raw materials. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Manufacturing, Raw Materials, Tax law, VAT Act 2013, VAT Relief
Level: Level 2

Topic: Value-Added Tax (VAT), Customs, and Excise Duties
Series: DEC 2023

Question Tag: Raw Materials

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FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

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FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

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FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

You're reporting an error for "FA – Nov 2021 – L1 – SB – Q5d – Inventory"

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

You're reporting an error for "PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties"

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

You're reporting an error for "FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation"

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

You're reporting an error for "FA – Nov 2021 – L1 – SB – Q5d – Inventory"

PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties

Conditions VAT-registered manufacturing companies must meet for VAT relief on imported raw materials.

You're reporting an error for "PT – Dec 2023 – L2 – Q2a – Value-Added Tax (VAT), Customs, and Excise Duties"

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