Accountancy & Auditing, Paper II

Pak PVC (Pvt) Ltd. manufactures a high-quality plastic pipe in two departments, Cooking and Molding. After the cooking is completed, the completed units are transferred into the Molding Department, in which pipe is formed. The following data was reported for the Cooking Department during January 2015: Item Units/Amount Pounds in process, May 1 0 Pounds started into production during January 185,000 Pounds completed and transferred to Molding Department 175,000 Pounds in process, May 31 (materials 100%, conversion 30%) 10,000 Cost added during January: Item Amount Materials cost Rs. 55,500 Conversion cost Rs. 356,000 Required: Prepare a cost of production report for Cooking Department.

Following data was reported for Ibrahim Cottage Textile for the year ended December 31, 2014: Item Rs. Administrative Expenses 150,000 Depreciation, factory equipment 19,000 Direct labor 70,000 Finished goods inventory, beginning 20,000 Finished goods inventory, ending 35,000 Indirect labor 30,000 Insurance, factory equipment 800 Maintenance, factory equipment 6,000 Purchases of raw materials 118,000 Raw materials inventory, beginning 7,000 Raw materials inventory, ending 15,000 Rent, factory facilities 20,000 Sales 800,000 Supplies 4,200 Work in process, beginning 10,000 Work in process, ending 5,000 Required: Prepare a cost of goods sold statement.

Compute taxable income of Miss. Faryal for the tax year ended on June 30, 2013 on the basis of following information: Item Rs. Basic Salary 600,000 Dearness Allowance 15,000 Bonus 50,000 Project Allowance 7,000 Entertainment Allowance 5,000 Principal Allowance 25,000 Donation to Shaukat Khanam Memorial Hospital, Lahore 40,000 Donation to University of the Punjab, Lahore 20,000 Zakat paid under the Zakat and Ushr Ordinance, 1980 50,000 Overseas Allowance 30,000 M.Phil Allowance 60,000 Gain on sale of shares of Public Company (Sold within 6 Months) 150,000 Rent from Sublease of property (building) 200,000 Income from Property 300,000 Travelling Allowance and Daily Allowance (TA/DA) 25,000 Net profit from manufacturing business 100,000 Tax deducted at source from salary 30,000 Tax paid on registration of new locally manufactured motor vehicle 10,000 Efficiency Honorarium 18,000 Utilities Allowance 20,000

What are Articles and Memorandum of Association? Explain the basic contents of these documents.