AFRB 343 Advanced Financial Accounting 1 Semester 11 2011 / 2012 TUTORIAL: AQUACULTURE QUESTION 1 The data below is related to Aqua Tiger Bhd that cultures and sells tiger prawns as at 1 January 2006: Batch 1 Batch 2 (RM) (RM) Direct labour costs 40,000 10,000 Production overhead 20,000 30,000 Seed stock, fertilizer and chemical 15,000 25,000 Costs to complete the cycle 90,000 100,000 Estimated harvest 10,000 kg 15,000 kg Required: a) Determine the estimated total costs upon completion and estimated profit for each batch if the selling price for the tiger prawns is RM12/kg. b) If provision for batch 1 and batch 2 is RM16,000 and RM8,000 respectively, calculate the value of the closing stock at NRV and at cost

1

QUESTION 2 Marakisa Bhd involves in the aquaculture activities. The company has built 10 ponds and each pond takes 3 months to generate revenues. Therefore allowing Marakisa to operate 4 phases annually. Detail information on the costs and revenues for the year 2006 is as follows: Types of cost Land acquisition Facilities (road and sewage) Ponds, equipment, water pump and generator Direct labour wages Supervisor’s salary Material costs Transportation costs Revenue: Phase 1 Phase 2 Phase 3 Phase 4 Amount (RM) 520,000 15,000 2,540,100 600/month 1,200/month 5,000/month 5% from revenue 575,800 620,300 490,000 680,400

sales

i. ii.

Additional information: Ponds and other equipment is depreciated at 10% per annum on a straight line basis. A worker is assigned to each pond and a supervisor is responsible for 5 ponds. Required: Prepare an income statement for the year 2006 for Marakisa Bhd in accordance with FRS 204.

2

QUESTION 3 Part A Aquaculture is defined in Financial Reporting standard (FRS 204) ‘Accounting for Aquaculture’ as the culture and husbandry of desirable aquatic animals, such as fish and prawns and aquatic plants such as algae and