The Best Shoes is a sandal manufacturing company in Bokaa village. The company receives its supply of leather from the B

[answerhappygod]

The Best Shoes is a sandal manufacturing company in Bokaa
village. The company receives its supply of leather from the
Botswana Meat Commission located in Lobatse. The only product of
the Best Shoes is sandals. The sandals are sold to retail outlets
in Gaborone.
Consider the following data for 2021:





Pula]
Indirect manufacturing labour
52 800
Direct labour

350 000
Direct materials inventory 1, Jan 2021
34 500
Direct materials inventory 31 Dec 2021
41 000
Finished goods inventory 1 Jan 2021
86 000
Finished goods inventory 31 Dec 2021
132 000
Work in process inventory 1 Jan 2021
43 000
Work in process inventory 31 Dec 2021
49 000
Rental Expenses1

98 000
Insurance2

42 000
Depreciation Expense3

40 000
Direct material purchased
268
000
Sales revenue

997 000
Marketing expenses

47 000
Marketing salaries

84 000
Distribution and Administration expenses
53 000
Additional Notes:
1. Rental expenses are shared as follows: 60 % to
factory, and 40 % to administration functions.
2. Insurance expenses are shared as follows:
80 % to the factory, and 20 % is allocated to sales and
distribution.
3. Depreciation expenses shared as follows:
75 % to the factory facilities, and 25 % is allocated to
administration functions.
Required:
[a] Prepare a Schedule of Cost of Goods Manufactured for the year
ending 31st December 2021.



[5]

Discuss any two [2] features of the income statement that
distinguish a manufacturing firm from a merchandising
firm. How do these differences impact on
activities of manufacturing companies?