ACCT-0050 Introductory Management Accounting Assignment 3 Question 1 Cacophony Electronics produces wireless speakers for outdoor us. Their most popular model is the Extreme and requires four separate EX13 components per unit. Sales of the Extreme are the highest in the second quarter of each year. The company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 16,000 units plus 10% of the next month's sales. The finished goods inventory on March 31 is budgeted to be 28,000 units. b. The raw materials inventory on hand at the end of each month must be equal to 20% of the following month's production needs for raw materials. The raw materials inventory on March 31 for EX13 is budgeted to be 98,400 components. c. The company maintains no work in process inventories. A sales budget for the Extreme speaker in units is as follows: April 120,000 May he direct taboo 150,000 June 210,000 July 106,000 August complaints mclean 60,000 samferent sue Required: 1. Prepare a production budget for the Extreme for April, May, June and July. 2. Prepare a direct materials purchases budget showing the quantity of EX13 components to be purchased for April, May and June and for the quarter in total.Question 2 Markman Industries employs a standard cost system. It has established the following standards for the prime costs of its air rifle product line: Standard quantity Standard price Standard cost Direct materials 4 kg $21.80/kg $ 87.20 0.5 direct labour Direct labour hours (DLH) $20.00/DLH 4.00 $ 91.20 During November, Markman purchased 13,000 kg of direct materials at a total cost of $295, 100. The total factory wages for November were $38,000, 90% of which were for direct labour. Markman manufactured 3,500 air rifles during November, using 13,500 kg of direct materials and 1,900 direct labour hours. Required: a) What was the direct materials purchase price variance for November? b) What was the direct materials quantity variance for November? c) What was the direct labour rate variance for November? d) What was the direct labour efficiency variance for November? e) Over the past year, Markman's management team attempted to reduce the number of customer complaints relating to the product by sourcing higher-quality direct materials from a different supplier. Explain the effect this has had on direct materials costs. 12. Varieblaine agency varjune vital budget verericeQuestion 3 Consider the following data provided for independent cases A & B. In each case the data refers to the month of October 2023. For each case assume that the business uses a standard cost system and a flexible budget to control variable and fixed manufacturing overhead, and applies manufacturing overhead on the basis of direct labour hours. Fill in the blanks for each case, and indicate whether the variances are favourable (F) or unfavourable (U). CASES B 1. Actual fixed manufacturing overhead cost incurred $10,600 2. Actual variable manufacturing overhead cost incurred 7,000 3. Denominator activity level (direct labour hours) 500 4. Standard direct labour hours applied to work in process 650 Flexible budget data: 5. Variable manufacturing overhead (per standard DLH) $8.50 6. Budgeted fixed manufacturing overhead 10,000 7. Budgeted variable manufacturing overhead 8. Total budgeted manufacturing overhead for actual output 12,525 Additional data: 9. Variable manufacturing overhead applied (standard cost) 7,500 10. Fixed manufacturing overhead applied (standard cost) 10,000 11. Volume variance 500 U 12. Variable manufacturing overhead spending variance 950 F 0 13. Variable manufacturing overhead efficiency variance 0 14. Fixed manufacturing overhead budget variance 300 F 15. Actual direct labour hours used