The following information is provided for Amusa Company Ltd a manufacturer: Prime cost - N999,000,...

Explanation

To understand this question, we first need to know the basic cost accounting concepts involved. The prime cost is the total cost of direct materials and direct labor used in manufacturing a product. Manufacturing overhead includes all indirect costs associated with the manufacturing process, such as rent, utilities, and depreciation. Work in progress represents the value of goods that are partially completed but not yet finished. The cost of production is the total cost incurred in manufacturing the finished goods. Let's break down the given information: Prime cost: ?999,000 Manufacturing overhead: ?132,000 Closing work in progress: ?75,000 Value of finished goods transferred to the Trading Account: ?1,116,000 Rent paid in advance (prepaid rent): ?5,000 First, we need to adjust the manufacturing overhead by subtracting the prepaid rent: Manufacturing overhead: ?132,000 - ?5,000 = ?127,000 Next, we calculate the total cost consumed by adding the prime cost and the adjusted manufacturing overhead: Total cost consumed: ?999,000 + ?127,000 = ?1,126,000 Now, let's find the opening work in progress. We can use the following equation: Cost of production = Total cost consumed + Opening work in progress - Closing work in progress We know that the cost of production is equal to the value of finished goods transferred to the Trading Account, which is ?1,116,000. We can now substitute the known values into the equation: ?1,116,000 = ?1,126,000 + Opening work in progress - ?75,000 Rearrange the equation to solve for the opening work in progress: Opening work in progress = ?1,116,000 - ?1,126,000 + ?75,000 Opening work in progress = -?10,000 + ?75,000 Opening work in progress = ?65,000 So, the opening work in progress for the period is ?65,000, which corresponds to Option D.