A B C D E F Year 1 ($) 70,000 70,000 75,000 87,000 48,000 48,000 63,000 62,000 62,000 62,000 40,000 50,000 60,000 2 ($) Expected net cash inflows (including salvage value) 3 4 5 ($) ($) ($) 70,000 70,000 246,000 180,000 175,000 180,000 180,000 35,000 82,000 82,000 150,000 Projects A and E are mutually exclusive. All projects are believed to be of similar risk to the company's existing capital investments. Any surplus funds may be invested in the money market to earn a return of 9 per cent per year. The money market may be assumed to be an efficient market. CCC's cost of capital is 12 per cent per year. 70,000 64,000 73,000 62,000 70,000 40,000 CCC also has a subsidiary company, which makes and sells a single product. The company operates a standard marginal costing system and a just-in-time purchasing and production system. No inventory of raw materials or finished goods is held. Details of the budget and actual data for the previous period are given below: Budget data Standard production costs per unit: Direct material Direct labour $22.50 Variable overheads 1.25 hours @ $6.00 per direct labour hour $7.50 Standard selling price: $180 per unit Budgeted fixed production overheads: $170,000. Budgeted production and sales: 10,000 units ● 8kg @ $10.80 per kg 1.25 hours @ $18.00 per hour Actual data Direct material: 74,000 kg @ $11.20 per kg Direct labour: 10,800 hours @ $19.00 per hour Variable overheads: $70,000 Initial Outlay ($) Actual selling price: $184 per unit Actual fixed production overheads: $168,000 Actual production and sales: 9,000 units. $86.40 Assignment activity and guidance Task 1 Your role is to help your Senior Management Accountant in utilizing management accounting techniques and information to help the company optimize its performance and achieve its strategic objectives. As Junior Management Accountant, you are required to write a report for your Senior Management Accountant to aid in decision-making and financial analysis. Firstly, you will explore the Nature, Source, and Purpose of Management Accounting Information. In your report, you should: Examine the different ways in which CCC will use accounting information to meet its organizational objectives. Explore the purpose of management accounting information for different stakeholders to maximize performance and minimize risk. Evaluate the role of management accounting information in supporting decision-making and meeting internal and external stakeholder needs and expectations. Critically evaluate the significance of management accounting information for 4 Submit your final work via moodle.gusto-education.com by 10th February 2024 (Saturday) 23:59 PM Submit your declaration form and Assignment Brief within 3 school days after Hand- in. Unit Learning Outcomes LO1: Explore the nature, source, and purpose of management accounting information. LO2: Evaluate management accounting techniques to inform optimal resource allocation and decision-making. LO3: Analyse actual and standard costs to control and correct variances. LO4: Evaluate how the management accounting function contributes to performance measurement and monitoring. Transferable skills and competencies developed Vocational scenario You have been hired as a Junior Management Accountant by a manufacturing company called Columbus Canopy Company (CCC) is a leading player in the industry and is constantly striving to maintain its competitive advantage. The company is experiencing rapid growth and facing various challenges in resource allocation, decision-making, and performance monitoring. CCC manufactures and sells adjustable canopies that attach to motor homes and trailers. The following income statement represents the operating results for the year just ended. The company had sales of 900 tons during the year. The manufacturing capacity of the firm's facilities 1,500 tons per year. (Ignore income taxes.) Sales $ 900,000 Less Variable costs: Manufacturing Selling costs Total variable costs Contribution margin Fixed costs: Manufacturing Selling. Administrative Total fixed costs Net income Year 1 ($) A B с D E F $315,000 $180,000 2 ($) CCC wishes to expand its operations. Six possible capital investments have been identified, but the company only has access to a total of $620,000. The projects are not divisible and may not be postponed until a future period. After the projects end it is unlikely that similar investment opportunities will occur: $ 100,000 $ 107,500 $ 40,000 Expected net cash inflows (including salvage value) 3 4 ($) ($) 70,000 $ 495,000 .$ 405,000 5 ($) 70,000 .$ 247,500 .$ 157,500 73,000 62,000 50,000 60,000 70,000 40,000 70,000 70,000 70,000 246,000 75,000 87,000 64,000 180,000 48,000 48,000 63,000 175,000 62,000 62,000 62,000 180,000 40,000 180,000 35,000 8200 150,000 Projects A and F are mutually exclusive All projects are believed to be of similar risk Initial Outlay ($) 4