Botswana College of Distance & Open Learning

Diploma in Business Management

Principle of Accounting
Assignment: 2
Mmoniemang Motsele
Student No: 201006379

Victors
Manufacturing Account
Opening stock of raw materials
Add Purchases of raw materials
Add carriage on raw materials
Less closing stock of raw materials
Cost of raw material consumed
Add Direct wages
Prime cost
Factory general expenses
Factory rent
Depreciation of factory equipment
Factory overheads
Gross cost of production
Add work in progress at start
less work in progress at end
Net cost of production

P
2990
15630
126
18746
(4200)
14546
48648

63194
7048
2100
4200
13348
76542
3900
80442
(3600)
76842

P
Sales
Add sales of scrap

P
112410
1317
113727

Opening Stock of finished goods

15300

Add cost of production

76842

Less stock of finished goods

92142
(17700)

Cost of sales
Gross profits
Add discount received
Less Expenses
Office salary
bad debts on Expenses

22200
200

Depreciation of office furniture

Advertising
Rent
Carriage Outwards

420
1472
700
191

Net Profit

(74442)
39255
188

(25183)
14290

Question 2
MIKA

NIKA

Gross profit as a % of Sales

Gross profit x 100
Sales

Gross profit x 100

Sales

315x100
555
56.75%

420x100
750
56%

Net profit as a % of Sales

Net profit x 100
Sales

Net profit x 100

Sales

100x100
555
18%

150x100
750
20%

Expenses as a % of Sales
Expenses x 100
Sales

Expenses x 100
Sales

215x100
555
38.73%

270x100
750
36%

Stock Turnover
Cost of goods sold
Average stock

Cost of goods sold

Average stock

240x100
80
3times

330
75
4.40times

Return on capital employed

Net profit
Capital employed

Net profit
Capital employed

100x100
116
86.2%

150x100
152
98.7%

References:
Wood, F. and Sangster A., 1999. Business Accounting 1 8th Ed.
Ainsworth, P. and Deines D., 2010 Introduction to Accounting 6th Ed.
www.opentuition.com: ACCA. Introduction to Financial Reporting