Paper 2 · November 2014 · Manufacturing Accounts
Mwanza Manufacturing Company's Manufacturing Account for the year ended 31 December 2010 showed a prime cost of $78 000 and total factory overheads/production cost of goods manufactured of $97 000. In the Trading Account, sales were $150 000, and cost of sales (opening finished goods stock $14 000 plus production cost $97 000 less closing finished goods stock $24 000) was $87 000. What was the gross profit?
A$63 000
B$78 000
C$87 000
D$97 000
Explanation
$150 000 - $87 000 = $63 000.
Derived from ZIMSEC Principles of Accounts 7112/2 Paper 2, November 2014 Specimen Paper, Q3