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  • 01-12-2012 3:57pm
    #1
    Justin10
    Registered Users Posts: 3,188 ✭✭✭


    Just doing a question and not sure on how to answer the below scenarios.
    Any help would be fantastic. Thanks very much

    Trial balance as at 31/05/09
    €000
    Revenue 164000
    Production cost 90000
    Income Tax 100
    Tax payable estimate 500
    Inventories at 31/05/08 19710

    Note 1 year end 31/05/09 sold good value 30M under warranty. Terms were if defective within 12 months of purchase would be repaired or replaced. Each product sold there 20% chance of a defect. Any warranty costs are included in production costs. Where warranty costs incurred on average amount to 50% of revenue received from sale of product. €900,000 warranty costs have been included within production costs in trial balance.

    Note 2 Stock at 31/05/09 was 20M Included within this balance are stock valued at 5M which where damaged 10/12/08. They will need to be marked to 40% of original selling price.

    Note 3 Final estimated income tax on profits for year end 09 is 1.6M. During the year 1.3M and full settlement of income tax on profits year ended 31/05/08 where paid. Statement of financial position had included 1.4M in respect to this liability.


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