Reference no: EM133187232
Question 1 - Dylans Limited, a manufacturing company, is planning to bring a new product, the Bryant, to the market and has the following budgeted cost data:
GHC
Selling price per unit 150
Direct material cost per unit 55
Direct wages cost per unit 20
Variable overhead cost per unit 5
Total fixed overheads attributable to the Bryant product are GHC700,000. The maximum possible production capacity is 30,000 units. Dylans Ltd has budgeted to make sales for the first year of 12,000 units.
Required -
1. Calculate the draft budgeted contribution per unit
2. Calculate the draft budgeted break-even point
3. Calculate the draft budgeted profit
Question 2 - Maame Morla has her own business. She has produced a trial balance from her accounting records for the year ending 31 December 2013. This is printed below:
|
Account Balances at 31st December 2013
|
Debit GHC
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Credit GHC
|
|
Wages and salaries
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113,100
|
|
|
Capital, at 1st January 2013
|
|
177,000
|
|
Bank Overdraft
|
|
27,600
|
|
Insurance expense
|
2,700
|
|
|
Accumulated depreciation of plant & machinery, at 31 December 2013
|
|
60,000
|
|
Sales
|
|
455,000
|
|
Freehold land and buildings, at cost
|
165,000
|
|
|
Administration expenses
|
23,400
|
|
|
Debtors
|
37,400
|
|
|
Loan: repayable 30 September 2014
|
|
20,000
|
|
Purchases
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216,000
|
|
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Drawings
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20,000
|
|
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Trade creditors
|
|
19,700
|
|
Stock at 1st January 2013
|
22,600
|
|
|
Rates expense
|
3,500
|
|
|
Distribution expenses
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47,200
|
|
|
Plant & machinery at cost
|
90,000
|
|
|
Heat and light expense
|
2,400
|
|
|
Cash in hand
|
1,000
|
|
|
Depreciation expense
|
15,000
|
|
|
|
759,300
|
759,300
|
The following information is relevant to the financial information:
1. Stock at 31 December 2013 was valued at GHC19,800
2. Maame Morla has taken some of the good during the Eid-Al-Fitr festival valuing GHC10,000
3. Heating and lighting outstanding at the end of the year 31st December 2013 was GHC1,000
4. Pre-payment of rates expenses was GHC1,500.
Required -
1. Prepare her profit and loss account for the year ending 31 December 2013, and her balance sheet as at that date.
2. Use the results in above to calculate the (i) Gross profit margin, (ii) Net profit margin, (iii) current and acid ratios.