Phi Ltd Date: 31 March 2024Details:Raw materials inventory (wool):Cost: £30,000Replacement cost: £28,000Finished goods inventory:ProductEpsilonZetaDirect costs£70,000£55,000Proportion of...
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Accounting
Phi Ltd
Date: 31 March 2024
Details:
- Raw materials inventory (wool):
- Cost: £30,000
- Replacement cost: £28,000
- Finished goods inventory:
Product | Epsilon | Zeta |
Direct costs | £70,000 | £55,000 |
Proportion of fixed overhead | £20,000 | £15,000 |
Proportion of selling costs | £4,500 | £3,500 |
Net realizable value | £105,000 | £75,000 |
- Machinery:
Acquired on 1 April 2017 for £400,000, depreciated over 12 years using the reducing balance method. - Freehold property:
Acquired 12 years ago for £2,300,000, land value estimated at £600,000. Buildings are depreciated over 50 years. - Research and development:
- Research costs: £100,000
- Development costs: £125,000, benefiting over 5 years.
Required:
Explain the financial statement impact of these items for Phi Ltd as of 31 March 2024.
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