all step The Board of Directors of Nanak Engineering Company Private Ltd. requests youto prepare a statement showing the Working Capital Requirements for a level ofactivity of 1,56,000 units of production.The following information is available for your calculations :(a)Raw materialsDirect labourOverheadsPer unit?90407520560265(b) (i)(ii)ProfitSelling price per unitRaw materials are in stock, on average one month.Materials are in process, on average 2 weeks.(iii) Finished goods are in stock, on average one month.(iv) Credit allowed by suppliers, one month.(v)Time lag in payment from debtors, 2 months.(vi) Lag in payment of wages, 12 weeks.(vii) Lag in payment of overheads is one month.20% of the output is sold against cash. Cash in hand and at bank isexpected to be 60,000. It is to be assumed that production is carried onevenly throughout the year, wages and overheads accrue similarly and atime period of 4 weeks is equivalent to a month.

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Answered: The Board of Directors of Nanak…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter9: Responsibility Accounting And Decentralization

Section: Chapter Questions

Problem 3PA: The income statement comparison for Forklift Material Handling shows the income statement for the...

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You are required to prepare a statement showing the working capital required to finance a level of activity of 18000 units from tile following information: Particulars Amount per unit (Rs.) Raw Materials 12 Direct Labour 3 Overheads 9 Total Cost 24 Profit 6 Selling Price 30 (a) Raw materials are in stock on an average for 2 months. (b) Materials are in process on an average for 1/2 a month. (3) Finished goods are in stock on an average for 2 months. (d) Credit allowed by creditors is 2 months. (e) Credit allowed to debtors is 3 months. (f) Lag in payment of wages is 1/2 a month. (g) Cash on hand and at bank is expected to be Rs. 7000.
You are required to prepare a statement showing the working capital required to finance the level of activity of 18,000 units per year from the following information:- Particulars Rs. Raw material Per Unit 12 Direct labor Per Unit 3 Overheads per Unit 9 Total cost Per Unit 24 Profit per Unit 6 Selling price Per Unit 30 Additional Information:1. Raw material is in stock on an average for 2 months.2. Materials are in process on an average for half-a- month.3. Finished goods are in stock on an average for two months.4. Credit allowed by creditors is two months in respect of raw materials supplied.5. Credit allowed to debtors is three months.6. Lag in payment of wages is half month. Cash on hand and at bank is expected to be Rs. 7,000.7. You are informed that all…
From the following information prepare a statement showing the estimatedworking capital requirement:(1)Projected annual sales 36,000 units(2)Analysis of salesRaw materials Rs. 6 per unitLabour Rs. 4 per unitOverhead Rs. 3 per unitProfit Rs. 2 per unitSelling price Rs. 15 per unit(3)Additional Information :(a) Raw material in stock 1 month(b)Production process 2 months(c) Finished goods in store 3 months(d)Credit allowed to debtors 4 months(e) Credit allowed by suppliers 2 months(f) Monthly wages and expenses are paid twice on 1st and 16th of each month.(g)Production is carried on evenly during the year and expenses and wages accruesimilarly.(h)Cash is to be kept at 10% of the net working capital.
How would each of the following costs be classified if units produced is the activity base? a. Salary of factory supervisor ($120,000 per year) b. Straight-line depreciation of plant and equipment c. Property rent of $11,500 per month on plant and equipment
Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: May $198,000 April $156,000 a. $49,500 b. $252,000 c. $202,500 d. $153,000 Manufacturing costs* Insurance expense** Depreciation expense Property tax expense*** *Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the following month. **Insurance expense is $900 a month; however, the insurance is paid four times yearly in the first month of the quarter (i.e., January, April, July, and October). ***Property tax is paid once a year in November. The cash payments for Finch Company expected in the month of June are 900 1,850 500 900 1,850 June 500 $204,000 900 1,850 500 Previous Next
The cost data relating to units of production for the year ending 31st December 2020 are as follows:Material (for 10,000 units actually produced) £10,000Subcontracted Labour (for 10,000 units actually produced) £20,000Production overheads £50,000There are 1,000 units of inventory unsold at the year end. Production was half the normal activity level.Compute the inventories figure shown in the Statement of Financial Position as at 31st December 2020.
Accounting A company gets three byproducts A, B and C, in quantities of 6000, 10,000, and 5000 tons, respectively/month from the manufacturing process of their main product. The company can make a fertilizer consisting of 30% of A, 50% of B, and 20% of C and sell it at a pro t $5/ton. They can also make a construction material consisting of 40% of A, 30% of B, and 30% of C and sell it at a pro t $4/ton. Any leftover quantities of A,B, and C can be given away to a company dealing with bulk materials. QUESTION 3 Based on recent market information, the company finds that the demand for the fertilizer is reduced to 15,000 tons/month. What is the new optimal plan for the company? NOTE: The solution to question 3 is the ONLY answer needed.
Blue Incorporated manufactures a product with the following cost structure: Price per unit Selling price R12 Production costs: Material R2 Labour R2 Variable overheads R1 Fixed overheads R5 000 Over a three-year period the production and sales of the product are as follows: Y1 Y2 Y3 Production 2 000 1 000 2 000 Sales 1 000 2 000 2 000 Required: 1.1 You are required to produce the Statement of Financial Performance over the three-year period under the absorption costing. 1.2 Evaluate the application of the absorption costing method in profit reporting.
Coe Aggregates Ltd has scheduled the production and sale of 35,700 tonnes of aggregates for the Month of April, 2021. Given the following information: Selling prices: $23.15 / tonne Tax rate 30% (of net income) Operating costs Direct material cost: $5.75 /tonne Direct labour cost: $8.05/ tonne Variable overhead costs: $1.56/tonne Fixed overhead cost: $115,820 Selling and Administrative costs Variable: $1.27/tonne Fixed: $28,000 1)Calculate the expected monthly net income after tax (profit) for the month of April 2021 2)Calculate the scheduled production tonnage and sale required to attain a desired net income after tax (profit) of $78,500 for the month of April 2021. PLEASE type or print clearly
You are a Financial Planning and Control Manager at FreeAir Ltd, a leading manufacturer of fans used in air conditioning systems. The company is located in Liverpool, UK. In the year ended 31 March 2019, manufacturing cost per unit comprised: Direct material - £125Direct labour(20 min per unit) - £15Variable manufacturing overhead - £20Variable selling expences - £15Variable administrative expences - £10 The company produced and sold 45,000 fans during the year ended 31 March 2019. The selling price per unit was £300. Fixed overheads for the year ended 31 March 2019 were: Fixed manufacturing overheads- £1650Fixed selling and distribution overheads - £2850Fixed administrative overheads - £930 Jessica Olusange, Chief Executive, has developed a new strategy for the business. The company has invested in a new manufacturing facility in Leicester, UK: this investment means that fixed costs will increase by £1,450,000 from 1 April 2019. However, the move to the new manufacturing facility…
Calculate the following:(a) Prime cost (b) Factory cost (c) Production cost(d) The selling price per product to gain 12% profit when the production volume of the product is 15000.
Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: April May June Manufacturing costs* $156,800 $195,200 $217,600 Insurance expense** 1,000 1,000 1,000 Depreciation expense 2,000 2,000 2,000 Property tax expense*** 500 500 500 *Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the following month.**Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the quarter (i.e., January, April, July, and October).***Property tax is paid once a year in November. The cash payments expected for Finch Company in the month of April are a.$120,600 b.$123,100 c.$121,100 d.$122,600

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