Question

Q.1 Modern Bakery started its company with a total Capital of 2 Million with a Bank loan. For the year 2019 Company has produced and sold 10 Million of Bread. The following are the particulars regarding the bread produced and sold by them. The Stock of Flour Material opening was OMR 40,000, closing OMR 20,000 and during the year purchase of flour was OMR 45,000 for which transportation paid OMR 250. Amount paid to the workers who makes the bread OMR 14,000. Company has spent OMR 1,350 for Lubricating oil for the machinery and Packing Material of OMR 1,720. Electricity expense of OMR 1,000 had been spent in the office.

Rent and Insurance for Factory OMR 5,450, for Office OMR 7,150, Total of Managers salary amounting to 25,000 which belongs to 1/4^th for Factory manager and 3/4^th to Office manager and the amount of commission paid to factory manager was OMR 700, Depreciation were calculated on Straight line balance method for the machineries in the office and factory and the value of depreciation for the Office was OMR 1,000 and Factory was OMR 1,200.

Once the goods were manufactured all the finished products were kept in a warehouse for which company has spent OMR 9,000 for its rent. There was Opening balance of finished goods of 1,500 with no Closing Balance of Finished goods. Work in process Opening 18,000, Work in process closing 12,000. Three fourth of the warehouse was given for rent and the rent received by the company was OMR 2,467.

Total bread manufactured has been sold at OMR 170,000 and in order to make a Sales Company has spent on samples and gifts OMR 1,500, Show room cleaning expenses and Insurance were OMR 1,730 and Sales Managers Salary of OMR 3,000. Transportation expenses of OMR 7,700 for transporting the bread to different markets. In the Year end Company has paid Interest on the Bank Loan of OMR 10,500

1. You are required to prepare a Cost Sheet from the relevant information provided in Modern Bakery Company (4.5 Marks)
2. Modern Bakery Company was expecting to earn a profit of 15% on Cost of Production. You are required to identify from the cost sheet whether the company has earned the profit as per their expectations or not. If not find out the difference in profit which the company has earned and the company has expected. (0.5 Mark)

urgent answer!

Answer 1