BACAX3A 2021 ASSIGNMENT II: STANDARD COSTING TOTAL MARKS: 15 Instruction Use the Answer Sheet provided to answer the questions as indicated. Thereafter, upload the completed answer sheet as your submission. All submissions must be PDF FORMAT. Any other format will be discarded. Question 1 Bamfran Limited is a well-established manufacturer of a specialized product, a Wallop, which is manufactured using two input components: the Wals, and the Lops. The following specifications have been provided for production: Components Standard quantity per unit of Standard price per unit Wallop (R) 15 units 60 8 units 75 WALS LOPS The standard direct labour hours to produce a Wallop at the standard wage rate of R10.50 per hour has been established at 60 hours per Wallop. The annual budgeted fixed production overhead is divided into calendar months with equal production per month. The budgeted annual fixed overheads are R504 000, calculated based on the budgeted output of 2 400 Wallops per annum. Overheads and outputs are spread evenly during the year. An absorption costing system is applied. Mr. Jones, a marketing specialist, is now the managing director of Bamfran Limited and must report to the board of directs later this day and he seeks your advice in respect of the following actual operating information for the month of May: R R 504 000 Sales Cost of sales: Direct material Direct labour Fixed production overheads Gross profit Administration expenses Selling and distribution expenses Net profit 281 520 112 329 42 600 (436 440) 67 560 (11 150) (17 290) 39 120 The sales manager informs Mr. Jones that despite adverse trading conditions, his sales staff have been able to sell 180 Wallops. These units were sold at the expected standard selling price. The production manager along with the purchasing department manager are also pleased that prices for components have been stable for the whole of the current year and they are able to provide the following information regarding the stocks for May: 1 BACAX3A 2021 ASSIGNMENT II: STANDARD COSTING TOTAL MARKS: 15 Instruction Use the Answer Sheet provided to answer the questions as indicated. Thereafter, upload the completed answer sheet as your submission. All submissions must be PDF FORMAT. Any other format will be discarded. Question 1 Bamfran Limited is a well-established manufacturer of a specialized product, a Wallop, which is manufactured using two input components: the Wals, and the Lops. The following specifications have been provided for production: Components Standard quantity per unit of Standard price per unit Wallop (R) 15 units 60 8 units 75 WALS LOPS The standard direct labour hours to produce a Wallop at the standard wage rate of R10.50 per hour has been established at 60 hours per Wallop. The annual budgeted fixed production overhead is divided into calendar months with equal production per month. The budgeted annual fixed overheads are R504 000, calculated based on the budgeted output of 2 400 Wallops per annum. Overheads and outputs are spread evenly during the year. An absorption costing system is applied. Mr. Jones, a marketing specialist, is now the managing director of Bamfran Limited and must report to the board of directs later this day and he seeks your advice in respect of the following actual operating information for the month of May: R R 504 000 Sales Cost of sales: Direct material Direct labour Fixed production overheads Gross profit Administration expenses Selling and distribution expenses Net profit 281 520 112 329 42 600 (436 440) 67 560 (11 150) (17 290) 39 120 The sales manager informs Mr. Jones that despite adverse trading conditions, his sales staff have been able to sell 180 Wallops. These units were sold at the expected standard selling price. The production manager along with the purchasing department manager are also pleased that prices for components have been stable for the whole of the current year and they are able to provide the following information regarding the stocks for May: 1