Delta Inc. Date: 30 September 2023Details:Raw materials inventory (metal):Cost: £35,000Replacement cost: £33,000Finished goods inventory:ProductGammaDeltaDirect costs£70,000£60,000Proportion of...
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Accounting
Delta Inc.
Date: 30 September 2023
Details:
- Raw materials inventory (metal):
- Cost: £35,000
- Replacement cost: £33,000
- Finished goods inventory:
Product | Gamma | Delta |
Direct costs | £70,000 | £60,000 |
Proportion of fixed overhead | £18,000 | £16,000 |
Proportion of selling costs | £5,000 | £4,500 |
Net realizable value | £110,000 | £90,000 |
- Office machinery:
Acquired on 1 October 2017 for £330,000, depreciated over 10 years using the reducing balance method. - Freehold property:
Acquired 16 years ago for £2,800,000, land value estimated at £700,000. Buildings are depreciated over 60 years. - Research and development:
- Research costs: £630,000
- Development costs: £1,110,000, benefiting over 7 years.
Required:
Discuss the treatment of these items in Delta Inc.'s financial statements for the period ending 30 September 2023.
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