The following information was found in Mr. Kamau’s farm record for the year ending December 2014. Study it carefully and answer the questions that follow.
Bought goats 4,000
Bought poultry 15,000
Bought dairy meal 25,000
Bought pasture seeds 50,000
Transportation of farm produce 15,000
Paid casual workers 12,000
Hired an ox-plough 10,000
Opening valuation 150,000
Sale of mohair 75,000
Sale of rabbits 36,000
Sold dairy cow 70,000
Received cash from the sale of wheat 100,000
Sold cabbages 20,000
Received money from the sale of eggs 15,000
Closing valuation 200,000
i)Prepare a profit and loss account for Mr. kamau’s farm. (7 marks)
MR KAMAU’S FARM PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDING DECEMBER 2014
|
Purchases and expenses |
Sales and receipts |
|
Opening valuation 150,000 |
Sale of mohair 75,000 |
|
Bought goats 4,000 |
Sale of rabbits 36,000 |
|
Bought poultry 15,000 |
Sold dairy cow 70,000 |
|
Bought daily meal 25,000 |
Sale of wheat 100,000 |
|
Bought pasture seeds 50,000 |
Sold cabbages 20,000 |
|
Paid for transportation of farm produce15,000 |
Sale of eggs 15,000 |
|
Hired an ox-plough 10,000 |
Closing valuation 200,000 |
|
Paid casual workers 12,000 |
|
|
Total 281,000 |
|
|
Profit 235,000 |
Total 516,000 |
|
516,000 |
516,000 |
ii)Did he make a profit or loss. (1 mark)
ü profit of 253,000
iii) Calculate the percentage profit or loss that Mr. Kamau made. (2 marks)
ü 235,000÷281,000×100=83.6%
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