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Principles of management accounting

QUESTION 1 (63 marks) Heart Felt (Ply.) Ltd ("Heart Fell') is a wood bench manufacturer located in Mpumalanga. Heart Felt handcrafts beautiful wooden benches which it sells to the public Wood is purchased from plantations in Waterval Boven, Mpumalanga. Once the wood has been delivered at Heart Felt's premises, Heart Felt carpenters carve and assemble the benches. During the manufacturing process, 22 nails are used but their cost is immaterial compared to the wood required to create the bench. It is considered that wood's utilisation and conversion costs (.e., direct labour, variable and fixed overheads) are incurred uniformly during production In order to manufacture a bench 4.4 meters of wood is required of which 1.1 meters are lost when the bench has been 55% completed. This is regarded as a normal loss. The crafters spend 35 hours to manufacture a completed bench. On 31 March 2022, 68 benches which were 20% complete were on hand, while 1 150 benches were on hand on 30 April 2022 which were 40% complete. Manufacturing of 2 910 benches have been commenced with during April 2022, while 2 788 benches have been completed during this period. Heath Felt employs a first-in-first-out (FIFO) costing method. The following costs have been incurred: R Material cost of units as at 31 March 2022 100 060 Conversion cost of units as at 31 March 2022 230 400 790 000 Wood purchased during April 2022 Nails purchased during April 2022 18 200 ANNEXURE I: FORMATIVE ASSESSMENT 2 Carpenters' wages for April 2022 188 000 26 000 Inspector's salary for April 2022 Cleaners' remuneration for April 2022 12 000 6 000 Water and electricity for April 2022 Depreciation for April 2022 23 400 ANNEXURE I: FORMATIVE ASSESSMENT 2 Carpenters' wages for April 2022 188 000 Inspector's salary for April 2022 26 000 Cleaners' remuneration for April 2022 12 000 6 000 Water and electricity for April 2022 Depreciation for April 2022 23 400 Required: Prepare the process report (including the cost allocation statement) for Heart Felt (Pty). Ltd. on 30 April 2022. Round to two decimals where required. Remember, quantities are expressed as integers (whole numbers). (63 marks)