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WAEC Financial Accounting 2001 Question 28

Question 28

Manufacturing Accounts

Opening Stock of Raw Materials N8,000
Purchases N45,000
Closing Stock of Raw Materials N9,500
Direct wages N6,450
Indirect wages N2,800
Depreciation – Plant and Machinery N3,200
Factory rents and rates N350
Opening work-in-progress N3,250
Closing work-in-progress N3,750
Factory cost of production is

  1. A.N56,300
  2. B.N53,000
  3. C.N52,750
  4. D.N45,500.
Show the answer and explanation

Answer: A (N56,300)

Explanation

Prime cost 49,950 + indirect wages 2,800 + depreciation 3,200 + rent 350 = N56,300.