Preparing Final Accounts of a Manufacturing Concern

The video tutorial covers the preparation of final accounts for a manufacturing concern, focusing on manufacturing, trading, and profit and loss accounts. It explains the components of each account, how to mark items for these accounts, and the importance of understanding the flow of costs and revenues. The tutorial also highlights the differences between manufacturing and trading accounts and provides guidance on handling specific items like depreciation and salaries.

What is the primary purpose of a manufacturing account?

• To record all office expenses

• To track the sales of finished goods

• To prepare the balance sheet

• To handle expenses and income related to production

Which account deals with the sales of finished goods?

• Balance sheet

• Profit and loss account

• Trading account

• Manufacturing account

Where should the opening stock of raw materials be recorded?

• Manufacturing account

• Balance sheet

• Profit and loss account

• Trading account

What is the correct treatment for carriage outwards?

• Debit in manufacturing account

• Credit in trading account

• Debit in profit and loss account

• Credit in balance sheet

How is the cost of material consumed calculated?

• Sales - Opening stock + Purchases

• Sales + Purchases - Closing stock

• Opening stock + Purchases - Purchase returns - Closing stock

• Opening stock - Purchases + Closing stock

What is the result of subtracting the closing stock of WIP from the total manufacturing expenses?

• Cost of goods produced

• Net profit

• Gross profit

• Total sales

Where should the depreciation on factory machinery be recorded?

• Balance sheet

• Trading account

• Profit and loss account

• Manufacturing account

Which account records office salaries?

• Manufacturing account

• Trading account

• Balance sheet

• Profit and loss account

What is the significance of the gross profit figure?

• It represents the net profit

• It reflects the profit from trading activities

• It shows the cost of production

• It indicates the total sales

What is the final step in preparing the accounts?

• Posting the sales figures

• Determining the net profit or loss

• Recording the opening stock

• Calculating the cost of goods produced