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Gamma Inc.
Date: 31 July 2023
Details:
- Raw material inventory (ceramics):
- Cost: £32,000
- Replacement cost: £30,000
- Finished goods inventory:
Product | Omicron | Pi |
Direct costs | £70,000 | £55,000 |
Proportion of fixed overhead | £18,000 | £15,000 |
Proportion of selling costs | £5,000 | £4,500 |
Net realizable value | £110,000 | £85,000 |
- Vehicles:
Acquired on 1 August 2017 for £310,000, depreciated over 10 years using the straight-line method. - Buildings:
Acquired 12 years ago for £2,600,000, land value estimated at £600,000. Buildings are depreciated over 55 years. - Research and development:
- Research costs: £380,000
- Development costs: £610,000, benefiting over 7 years.
Required:
Prepare the necessary journal entries for these items in Gamma Inc.'s financial records for the period ending 31 July 2023.
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