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Question 4 Dotito traders is operating two departments namely grocery and Butchery. The following balances are available as at 31 December 2021. Additional information 1. Inventory 31 December 2021; Grocery- $15,500 Butchery- $16,000 2. Rent expenses owing $13,000 3. Salaries and wages prepaid $12,000. 4. Electricity and water expenses were for 15 months to 31 March 2022 5. Rent expenses and electricity expenses must be apportioned between Grocery and Butchery basing on floor area. 6. Salaries and wages to be apportioned basing on the number of employees. The entity has a staff establishment of 10 employees of which 6 employees are employed by the grocery department and the remainder work in the butchery department. 7. 80% of the floor area is occupied by the grocery department and the remainder is utililised by the butchery department. You are required to prepare ; a. Dotito's departmental statement of comprehensive income for the year ended 31 December 2021. (20 marks) b. Identify any five factors to be considered before closing a loss making department. Page 5 of 6 Question 4 Dotito traders is operating two departments namely grocery and Butchery. The following balances are available as at 31 December 2021. Additional information 1. Inventory 31 December 2021; Grocery- $15,500 Butchery- $16,000 2. Rent expenses owing $13,000 3. Salaries and wages prepaid $12,000. 4. Electricity and water expenses were for 15 months to 31 March 2022 5. Rent expenses and electricity expenses must be apportioned between Grocery and Butchery basing on floor area. 6. Salaries and wages to be apportioned basing on the number of employees. The entity has a staff establishment of 10 employees of which 6 employees are employed by the grocery department and the remainder work in the butchery department. 7. 80% of the floor area is occupied by the grocery department and the remainder is utililised by the butchery department. You are required to prepare ; a. Dotito's departmental statement of comprehensive income for the year ended 31 December 2021. (20 marks) b. Identify any five factors to be considered before closing a loss making department. Page 5 of 6

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