Nu Ltd Date: 31 May 2023Details:Raw materials inventory (leather):Cost: £38,000Replacement cost: £36,000Finished goods inventory:ProductZetaEtaDirect costs£65,000£55,000Proportion of...
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Accounting
Nu Ltd
Date: 31 May 2023
Details:
- Raw materials inventory (leather):
- Cost: £38,000
- Replacement cost: £36,000
- Finished goods inventory:
Product | Zeta | Eta |
Direct costs | £65,000 | £55,000 |
Proportion of fixed overhead | £17,000 | £14,000 |
Proportion of selling costs | £4,500 | £3,500 |
Net realizable value | £95,000 | £72,000 |
- Machinery:
Acquired on 1 June 2018 for £320,000, depreciated over 10 years using the reducing balance method. - Freehold property:
Acquired 20 years ago for £2,500,000, land value estimated at £600,000. Buildings are depreciated over 60 years. - Research and development:
- Research costs: £60,000
- Development costs: £70,000, benefiting over 5 years.
Required:
Explain how these items should be accounted for in the financial statements of Nu Ltd for the year ending 31 May 2023.
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