Assignment questions Melody Musical Pty Ltd manufactures brass musical instruments for use in Primary and Secondary Schools across Victoria. The company uses a job costing system in which manufacturing overhead is applied based on direct labour hours. The company's budget for the current year included the following prediction. Budgeted total manufacturing overhead $426,300 Budgeted total direct labour hours 20,300 During March, the firm began two production jobs: Job number T81, consisting of 76 trombones. Job number C40, consisting of 110 cornets. The events of March are described as follows: 1,000 square metres of rolled brass sheet metal were purchased on credit for $5,000. 400 kilograms of brass tubing were purchased on credit for $4,000. The following requisitions were filled on 5 March: - Requisition number 112: 250 square meters of brass sheet metal @ $5.00 per square meter (For job number T81) - Requisition number 113: 1,000 kilograms of bras tubing @ $10 per kilogram (for job number C40) - Requisition number 114: 10 litres of valve lubricant @ $10.00 litre - All brass used in production is treated as direct material. Valve lubricant is an indirect material. An Analysis of labour time sheets revealed the following labour usage for March. - Direct labour: Job number T81, 800 hours @$20 per hour - Direct labour: Job number C40, 900 hours @$20 per hour - Indirect Labour: general factory clean-up, $4,000 - Indirect labour: factory supervisory salaries, $9,000 Depreciation of the factory building and equipment during March amounted to $12,000. Rent paid in cash for warehouse space used during March was $1,200. Electricity costs incurred during March amounted to $2,100. The invoices for these costs were received, but the bills were not paid in March. March council rates and property taxes on the factory were paid in cash, $2,400. The insurance cost covering factory operations for March was $3,100. The insurance policy had been prepaid in February. Costs of salaries and on-costs for sales and administrative personnel paid in cash during March amounted to $8,000. Depreciation on administrative office equipment and space amounted to $4,000. Other selling and administrative expenses paid in cash during March amounted to $1,000. Job number T81 was completed in March. Half (50%) the trombones in job number T81 were sold on credit during March for $700 each. The 1st of March balances in selected accounts are as follows: Cash $10,000 Accounts receivable $21,000 Prepaid Insurance $5,000 Raw material inventory $149,000 Manufacturing supplies Inventory $500 Work in process inventory $91,000 Finished goods inventory $220,000 Accumulated depreciation: Building and equipment $102,000 Accounts payable $13,000 Wages payable $8,000 Required: 1. Executive summary (5 Marks - Maximum 300 words): The one-page executive summary should offer a concise overview of the critical issues outlined in the case study and provide a brief background context. Additionally, it must include a summary of the key findings derived from your analysis. 2. Management Accounting Reports (10 Marks - Maximum 1,200 words): Provide the Cost of goods manufactured (COGM), Cost of Goods Sold (COGS) and Income Statement (I/S). Be sure to show all calculations for each of these reports. Accuracy in your calculations will be crucial for scoring well in this section. Present the data in a clear and organised manner to enhance the readability of your reports. In the report, please include the following information: *Details of T81 job costing including a job cost sheet, cost details and cost summary *Prepare journal entries to record all cost items and prepare ledger accounts *Show calculation of actual manufacturing overhead 3. Recommendation (5 Marks, Maximum 500 words): In the recommendation section, you must provide detailed and justified recommendations based on your case study analysis. Your recommendations should be well-reasoned and supported by evidence from your findings. *THE - END* *Show the COGM, COGS and IS. *Discuss about the efficiency in production process to convert from the raw materials into Work-in-progress and finished goods. Is there any warning signal shown in the process? *Comment on the overapplied/ underapplied manufacturing overhead. Identify the pros and cons of such overhead management *Comments on the cash and liquidity management shown in March financial reports * Comments on the Profit and Loss by the end of March.