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WAEC Financial Accounting 1991 (August) Question 42

Question 42

Manufacturing Accounts

A business which converts raw materials to finished goods prepares

  1. A.Trading Account and Balance Sheet.
  2. B.Profit and Loss Account and Balance Sheet.
  3. C.Balance Sheet only
  4. D.Trading Profit and Loss Account and Balance Sheet
  5. E.Manufacturing, Trading, Profit and Loss Account and Balance Sheet.
Show the answer and explanation

Answer: E (Manufacturing, Trading, Profit and Loss Account and Balance Sheet.)

Explanation

A manufacturer needs a manufacturing account as well as the trading, profit and loss account and balance sheet.