A)The information in Appendix below reflects this analysis of budgeted costs for the six month period to 30 June 2004. The total cost $709500 and distributed according given below percentage applied. Cost Types Production line A Labor, power, etc 41.437632% Set-up of machines 5.637773% Production scheduling 4.171952% WIP movement 5.130374% Purchasing and receipt of material 6.976744% Material scheduling system 2.536998% Design/Testing routine 2.255109% Production line development 3.523608% Production line maintenance 1.268499% General factory administration 17.618041% General factory occupancy 9.443270% XYZ-Budget data six months to 30 June 2004 Product Alpha Product Sigma Material Cost per Product Unit $60 $45 Production line A- machine hours per unit 0.8 0.5 Production batch size units 100 200 Total production units Use your Arid No. for Alpha and 1.75 time your Arid No. for Sigma (arid no is 3961) Components per product unit quantity 20 12 Number of customers 5 10 Number of production line set- ups 15 25 Production line A-maintenance hours 300 150 XYZ makes and sells a range of products. Management has carried out an analysis of the total cost of production. The analysis has identified that the factory is organized in order to permit the operation of three production lines A, B and C. Each production line facilities the production of two or more products. Production line A is only used for the production of products Alpha and Sigma. The products are manufactured in batches JIT basis in order to fulfill orders from customers. Only one product can be manufactured on the production line at any one time. Materials are purchased and received on a JIT basis. Additional information is available for production line A as follows: i. Production line machine costs including labor, power, etc., vary in proportion to machine hours. ii. Costs incurred for production scheduling, WIP movement, purchasing and receipts of materials are assumed to be incurred in proportion to the number of batches of product which are manufactured. Machine set-up costs vary in proportion to the number of set-ups required and are linked to a batch throughput system. iii. Cost for materials scheduling systems and design/testing routine are assumed to be incurred by each product in proportion to the total quantity of components purchased and total number of types of components designed/tested for products Alpha and Sigma are 12 and 8 respectively. iv. Product line development cost is identified with changes in product design and production method. At present such cost for production line A are apportioned 80%:20% to product Alpha and Sigma respectively. Production line maintenance costs are assumed to vary in production to the maintenance hours required for each product. Required: (1) prepare an activity based budget for production line X for the six month period to 30 June 2004 analyzed into sub-sets for activities which are product unit based, batch based, product sustaining, production line sustaining. The budget should show: (a) Total cost of each activity sub-sets grouped to reflect the differing operational levels at which each sub-sets is incurred/controlled. (b) Average cost per unit for each of products A and B analyzed by activity sub-set.

B) Budgeted information for X Ltd for the following period, analyzed by product, is shown below: Product A Product B Product C Selling price per unit $11 $10.5 $8 Variable costs per unit $5.8 $6 $5.2 Attributable fixed costs $275000 $337000 $296000 Sales Units for Product A use your arid no and multiply by 100, for Product B use your arid no last four digits 1.5 times and multiply by 100 and for product C use your arid no last four digits 0.8 times and multiply by 100, (arid no is 3961) General fixed costs, which are apportioned to products as a percentage sales are budgeted at $1668000. Required: (1) Calculate the budgeted profit of X Ltd, and each of its products. (2) Recalculate the budgeted profit of X Ltd. On the assumption that product C is discontinued, with no effect on sales of the other two products. State and justify other assumptions made. (3) Additional advertising, to that included in the budget for product A, is being considered. Calculate the minimum extra sales units required of product A to cover additional advertising expenses of $80,000. Assume that all other existing fixed costs would remain unchanged. (4) Calculate the increase in sales volume of product B that is necessary in order to compensate for the effect on profit a 10% reduction in the selling price of the product. State clearly any assumptions made.

C)The Enterprise Company manufactures two products, known as Odds and Ends. Odds are produced in department 1 and Ends in department 2. The following information is available for 1992. Material A $16 per unit - Variable overhead rates (PDLH) Odds ($) Ends ($) Material B $7.2 per unit - Indirect materials 0.80 1.2 Direct Labor $12 per hours - Indirect labor 1.2 1.2 Material A 9 units (Odds) 5 units (Ends) Power (Variable) 0.40 0.60 Material B 8 units (Odds) 10 units (Ends) Maintenance (Variable) 0.40 0.20 Direct Labor 15hours (Odds) 10hours (Ends) Fixed overheads Budgeted sales 1600units (Odds) 8500units (Ends) Depreciation 80,000 100,000 Selling Price $560 per unit (Odds) $400 per unit (Ends) Supervision 40,000 100,000 Ending inventory required Fig. 90 units (Odds) 1870units (Ends) Power (Fixed) 2000 40,000 Opening inventory required Fig. 85units (Odds) 170units (Ends) Maintenance (Fixed) 3196 45,600 Opening inventory 8000 units (A) 8500 units (B) Closing Inventory 1700 units (A) 10200units (B) Fixed Assets: Land $170,000, Building and Equipment $ 1292,000 ( $255000 Depreciation included) Current Assets: Finished goods $99,076, Raw Material $189,200, A/R $289,000, Cash $34,000 Liabilities and Owners Equity: A/P $248,800, Reserves $369,476 Represented by shareholders interest: 1200,000 ordinary share $1 each. Non manufacturing overheads: Stationery (office) $ 3000, Stationery (Sales) $1000, office salary $30,000, Sales salary $ 72,000, commission $62,000, Car expenses (sales) $20,000, Advertisements $78,000 and Misc. (Office) 10,000 Details Quarter 1 Quarter 2 Quarter 3 Quarter 4 Payments: $ $ $ $ Materials 400,000 480,000 440,000 547984 Wages 400,000 440,000 480,000 646,188 Other Costs 120,000 100,000 72,016 13,642 Receipts from Customers (000) 1000 1200 1120 985 You are required to prepare master budget for the year 1992 and following budget: 1) Sales Budget 2) Production budget 3) Direct material consumed budget 4) Direct material purchase budget 5) Direct labor budget 6) FOH budget 7) Selling and administration budget 8) Departmental budget 9) Cash Budget 10) Master Budget.