Nekoachemo Ltd is a well-established company which was established 35 years ago. The financial year-end is 30 April each year. The company purchases logs of wood and prepares them for sale to other companies which uses these prepared logs as raw material. The current financial year is 30 April 2021. 1. Materials: The business total annual demand is 100 000 logs of wood Vryheid Kwazulu-Natal. A log of wood is purchased for costs R3,00. Nekoachemo Ltd raise a loan at a 12% interest rate per annum to finance logs inventory. The variable costs are R25 to place an order of logs and that the other variable annual holding costs (excluding interest) is R1,10 for each log of wood. 2. Labour: The Nekoachemo Ltd hired five employees. Each of the four employees worked a total of 20 overtime hours. The one employee worked a total of 25 hours. Employees work 52 weeks in a financial year of which 45 weeks are normal working weeks. The company's normal hours in a week are 48 hours per employee. The normal rate is R50 per hour per employee. The overtime rate is two and half the normal rate. Employer's total contributions are as follows: Pension fund is 9% of basic salary. UIF is 1% of gross salary. Annual total Medical aid (for all employees) is R42 743,75 3. Overheads: The manufacturing overheads totalled R2 680 000 for the year. The total annual manufacturing overheads are eventually allocated to production divisions namely the Apple and Banana Divisions. The manufacturing overheads are expected to be allocated to the divisions as follows: Servicing Division Division Apple 30% Division Banana 25% General factory Division 10% 35% The general factory division represent space utilisation and the utilisation by divisions is as follows: Servicing Division Division Apple 50% Division Banana 25% 25% The servicing division service the two divisions based on labour hours. Division Apple 27 000 labour hours Division Banana 33 000 labour hours The logs of wood are recovered based on machine hours of each division as follows: Division Apple 25 000 hours Division Banana 30 000 hours 4. The month of April 2021 results: Nekoachemo Ltd has the following information for all the products for the one the month, the month of April 2021: Details Logs manufactured and sold. 12 000 R 800 000 500 000 Variable manufacturing costs (including overheads) Fixed manufacturing costs (including overheads) Fixed selling costs Variable selling costs Fixed administration costs Selling price (per log) 80 000 150 000 200 000 200 5. Budgeting: The Nekoachemo Ltd has the following forecasted information from which a cash budget needs to be compiled for the months of August and September 2021: a) The budgeted sales for the months under review are as follows: Month 1. June Sales (R) R4 000 000 2. July R5 100 000 3. August R6 000 000 4. September R6 200 000 b) The expenses (manufacturing and non-manufacturing) are expected to be maintained at 60% of the same month's sales. c) 72% of sales is collected in the same month of sales while 10% is collected one (1) month after the sale and the remaining 18% is collected two (2) months after the sale has taken place. d) 70% of expenses (manufacturing and non-manufacturing) are paid in cash and 30% are paid one (1) month after incurring the expense. e) The company will raise a loan of R900 000 in August for general business purposes. The first payment is 12% (10% interest and 2% capital portion) of the original loan amount will be made in September 2021. f) The dividends of R60 000 and R100 000 will be paid during months of August and September 2021, respectively. g) The company will make a cash donation of R50 000 to the local Red Cross offices during the month of September. h) The expected cash opening balance at the beginning of August is R1 500 000. REQUIRED Marks (7) (9) (12) Required Show all calculations. Round-off to two decimal places, unless stated otherwise. (a) Calculate total actual material costs, including total ordering and total carrying costs for the 2021 at EOQ. (b) Calculate total labour costs. (c) Determine the manufacturing overhead recovery rates for both Division Apple and Division Banana. (d) What are the reconciling items between variable costing and absorption costing systems? (e) Draft the actual statement of Profit or Loss for the month ended 30 April 2021 according to the direct costing method: (f) Prepare the cash budget for the months of August and September 2021 for Nekoachemo Ltd. Hint: Assume that all transactions are cash transactions unless otherwise told. Show all calculations as marks will be awarded for calculations. Round all your amounts to the nearest Rand. (2) (5) (15)