VUsolutions Transferred to AchiKhasi.com

From December 2011, this blog www.VUsolutions.blogspot.com is transferred to http://achikhasi.com/vu/ . So, you may visit http://achikhasi.com/vu/ for latest study related help.

Back to home VUsolutions

VUsolutions Fans Club [join us for MORE solutions]

VUsolutions on Facebook

Fin623 Assignment No. 1 Solution

Wednesday, October 27, 2010 Posted In Edit This
Business Income: Sales 11,250,000 
Less Cost of Sales
Market value of self produced raw material 3,750,000 
Raw Material purchased 2,250,000 
Manufacturing expenses 1,125,000 
Total Cost of Goods Sold 7,125,000 
Gross Profit 4,125,000 
Less Operating Expenses: 
Selling Expenses 750,000 
Administration expenses 1,275,000 
Financial expenses 375,000 
Total operating expenses 2,400,000 
Net Profit From Business 1,725,000 

Agriculture Income: 
Goods produced and used as raw material 3,750,000 
Less Agriculture Expenses 1,500,000 
Net Agricultural Income 2,250,000

.................


Ahmad Foods Limited is famous for its food products. The company is engaged in agricultural as well as industrial activities. It has its own farms where fruits, tomato, etc., are produced. These items along with those purchased from the market are used in manufacturing ketchup, Jams, Jelly and Marmalade.
Compute the business and the agricultural income from the following information for the
year ended on 30th June, 200A:
Sales of goods manufactured..........Rs. 11,250,000
Expenses on agriculture.......................1,500,000
Purchases from the market....................2,250,000
Manufacturing expenses ......................1,125,000
Selling expenses.............................750,000
Financial expenses............................375,000
Administrative expenses......................1,275,000
The market value of the goods produced by the company and utilized in manufacturing is Rs. 3,750,000.


Solution:- 


TWO PORTIONS TO SOLVE THIS QUESTION:

1- BUSINESS INCOME

2- AGRICULTUREAL INCOME


1-SOLUTION:


SALES RS. 11,250,000


LESS: COST OF SALES:


MKT VALUE OF GOODS PRODUCED BY

THE COMPANY IS RS. 3,750,000*
RAW MATERIAL PURCHASED 2,250,000
MANUFACTURING EXPENSES 1,125,000
TOTAL COST OF SALES ( 7,125,000)

GROSS PROFIT 4,125,000


LESS OPERATING EXPENSES:

SELLING + ADMIN + FINANCE COSTS (2,400,000)

NET PROFIT RS. 1,725,000


AGRICULTURAL INCOME:


MKT VALUE OF GOODS PRODUCED AND USED AS RAW MATERIAL RS. 3,750,000

LESS: EXPENSES ON AGRICULTURE (1,500,000)

NET AGRICULTURE INCOME RS. 2,250,000


NOTE* RULE 11 ( AGRICLUTURE PRODUCE AS RAW MATERIAL)


Where a cultivator or receiver of rent in kind uses the agriculture produce as raw material, in his business, then the income chargeable to tax under the head " INCOME FFROM BUSINESS" SHALL BE COMPUTED AS FOLLOW


TOTAL INCOME - MKT VALUE OF AGRICULTURE PRODUCE UTILIZED IN BUSINESS ARE RAW MATERIAL.

Back to home VUsolutions

Shaadi.com: Just create ur account & find ur partner or EARN money, its reall & EASY

VUsolutions Followers (Join NOW and Get Extra Benefits)

Install LATEST toolbar having lot of features - GET solutions on Desktop

toolbar powered by Conduit
Caliplus 300x250 NoFlam VitoLiv 468x60 GlucoLo