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Exercise 2 Nasibdar is a family business that specializes in the production of cargo bikes. The cargo bikes are assembled in department M. All frames,
Exercise 2 Nasibdar is a family business that specializes in the production of cargo bikes. The cargo bikes are assembled in department M. All frames, other bicycle parts and wooden boxes are purchased. Department M determines the production quantity and maintains the stock of assembled bicycles. The assembled cargo tricycles are all delivered at manufacturing cost price to department V, which sells 80% of the assembled cargo tricycles to private individuals. The other 20% of the assembled cargo tricycles are delivered at the same manufacturing cost to department S, which makes adjustments to the cargo tricycles at the request of customers. Departments V and S do not keep a stock of bicycles. The following information applies for 2020. The standard purchase price per frame and other parts is 530. The fixed purchase price per wooden box is 130. The assembly time per cargo bike is standard 2 hours at 60 (proportionally variable). The normal production and delivery for department M is 1 200 cargo tricycles per year. The fixed production costs for department M are 288,000 per year. The actual production of department M is 1 230 cargo bikes. The increase in the stock of cargo bikes at department M is 45 units. The fixed selling costs for department V amount to 14,400 per year. The proportionally variable selling costs for department V are 15 per cargo bike. Department V sells the cargo bike for a fixed sales price of 1,125. NB You do not have to take into account taxes. A) If parts are lost during production, is there waste or failure? Explain. B) Calculate the integral standard manufacturing cost of a cargo bike for department M. C) Calculate the commercial cost of a cargo bike for department V. D) Calculate the period result for 2020 for department M using the integral standard cost price (= AC absorption costing). Optionally specify the period result in a transaction result and an occupancy result. Indicate whether this result is positive or negative. E) Calculate the period result for 2020 for department V using the integral standard cost price. (= AC absorption costing). Optionally specify the period result in a transaction result and an occupancy result. Indicate whether this result is positive or negative
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