Joint costs for the 2022 financial year are budgeted to consist of the following: Raw material costs R375 000 Initial processing costs R591 000 Selling costs amount to R0,30 per unit for all soap types irrespective of whether a soap is sold at split- off point or after further processing. The company policy is to apportion joint costs at the split-off point based on the net realisable value (NRV) at split-off point method. Currently, the intention is to sell Hand soap without further processing but to process the other three soaps further after the split-off point. However, it was proposed that an alternative strategy would be to sell all four liquid cleaning soaps at the split-off point without further processing. If the proposed alternative strategy was to be adopted, the selling prices per unit obtainable would be as follows: Product Selling price per unit Dishwasher R 1,50 Pine cleaner R 2,40 Hand soap R 9,00 Citrus cleaner R30,00 MARY'S PRODUCTS (PTY) LTD The following statement summarises some of the standard costing variances of one of Mary's Products for January 2022: Selling price variance R11 985 (unfavourable) Unfavourable Favourable Some cost variances: R R Direct material price 2 500 Direct labour rate 500 Direct labour efficiency 400 Variable manufacturing overhead expenditure 1 500 Fixed manufacturing overhead expenditure 600 The budget for the same period contained the following data: Sales volume 5 000 units Sales revenue R50 000 Production volume 5 000 units Direct materials purchased and used 1 600 kg Direct material costs R10 000 Direct labour hours 2 400 Direct labour costs R10 000 Variable manufacturing overheads R4 100 Fixed manufacturing overheads R10 000 Additional information: Inventories of direct materials and finished goods are valued at standard cost. During the month the actual number of units produced and sold were 5 100. The total actual direct materials purchased and used for the month were 2 000 kg. Variable manufacturing overheads varies with production volume. The company has not budgeted to hold any opening and closing of inventory. REQUIRED Marks (3) (5) (3) (2) In respect of Sweets Cakes (Pty) Ltd: (a) Calculate the total over/under-applied overheads (all cakes) for December 2020, state whether it is over-applied or under-applied and prepare a journal entry showing how the over/under-application will be recorded in Sweets Cake's books at the end of the 31 December 2020 (b) Prepare the following general ledger accounts of Sweets Cakes (Pty) Ltd for the month of December 2020 (also balance the accounts): i. Materials control account. ii. Work-in-progress control account. (c) Calculate the profit/(loss) that Sweets Cakes made on Cake for Rosina. (d) Differentiate between Job costing and Process costing. In respect of Clean and Spotless (Pty) Ltd: (e) Calculate the budgeted profit or loss for Pine cleaner and Citrus cleaner if the current intention is proceeded with and joint costs are apportioned using the NRV at split-off point method. (f) Calculate the budgeted total costs associated with Hand soap if the alternative strategy is used and the NRV at split-off point is still used to allocate joint costs. (g) List three characteristics of a by-product. In respect of Mary's Products (Pty) Ltd: (h) Calculate the following: (1) The actual selling price per unit. (ii) The actual price per kilogram of materials. (iii) The total actual direct material costs. (iv) The actual direct labour hours. (v) The actual direct labour costs. (vi) The actual variable manufacturing overheads. (vii) The actual fixed manufacturing overheads. (10) (2) (3) (2) (2) (1) (2) (2) (2) (1) (i) List the possible causes of the direct materials usage variance, direct labour rate variance and sales volume variance. (6)