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WAEC Financial Accounting 2004 Question 32

Question 32

Manufacturing Accounts

Stock of raw materials – 1st January, 2002 N460,000
Purchases of raw materials N1,000,000
Carriage inwards N100,000
Stock of raw materials – 31st December, 2002 N500,000
Royalty paid N35,000
Manufacturing wages N80,000
Supervisor's salary N15,000
Cost of raw materials used is

  1. A.N1,175,000
  2. B.N1,140,000
  3. C.N1,075,000
  4. D.N1,060,000
Show the answer and explanation

Answer: D (N1,060,000)

Explanation

460,000 + 1,000,000 + 100,000 − 500,000 = N1,060,000.