WAEC Accounting 2020 Objective — Question 28

Question 28 of 50 from the West African Examinations Council (WAEC) Accounting 2020 Objective paper, with the correct answer and a full explanation.

Items shown in manufacturing account include

A. Purchases of raw materials I and Carriage inwards IV onlyCorrect
B. Purchases of raw materials I, Purchases of finished goods II, Carriage inwards IV, Carriage outwards III
C. I, II and III only
D. I, III and IV only

Explanation

The manufacturing account will only display costs incurred in the manufacturing of the goods. The cost of goods manufactured includes prime cost, factory overhead, and adjustment for work-in-progress. Purchases of raw materials and Carriage inwards belong there; purchases of finished goods and carriage outwards do not.

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