Part A Manufacturing and Merchandising divisions of Pixar Ltd Pixar Ltd is one of the leading food processing companies in Gulf region. Food processing sector is indispensable for overall development of an economy as it provides a vital linkage and synergy between the agriculture and industry. It helps to diversify and commercialize farming: enhance income of farmers; create markets for export of Agro- foods as well as generate greater employment opportunities. The CEO wants to explore more about management accounting systems and its implementation within this company (a) Manufacturing and Merchandising Divisions of Pixar Ltd Pixar Ltd has two divisions of operations i.e., manufacturing division and merchandising division. The cost and Sales details of Manufacturing and Merchandising Divisions Information Sales Inventory Merchandising Division Manufacturing Division For the year Beginning Land of For the year Beginning 2020 ($) of 2020 2020 2020 of 2020 2020 (S) ($) (S) 800,000 1,200,000 140,000 150,000 70,000 65,000 (Materials) Materials) 700,000 700,000 Materials) 558,000 of Purchases inventory Direct Labor 166,000 Manufacturing Overheads WIP inventory 160,000 54,000 (zero) 120,000 Finished Goods inventory Administration Expenses 50,000 55,000 (b) Production and Cost detaik of one of the Products being manufactured by its Manufacturing Division Production and cost details of one of the products of Pixar. Ltd. is a given below: Information Sper unit Selling Price 500 Direct Material 300 300 (per unit of material) Direct Labour cost 550 per hour 150 Number of labour. hours needed to 6 hours manufacture one unit of product Fixed Costs for the company $ 40,000 3- c) Estimations Sales and Cost details for one of its products for the next 3 months The company has estimated its sales and production cost for one of its products for the next three months u below: Particulars Units expected to be sold May 40% more than March sales units March April 110,000 units 20% more than March sales units 40 45 15 per unit 15 per unit 800.000 Selling Price per unit) Variable cost per unit Fixed Cost for this period 50 15 per unit Required (1) As the company wants to implement management accounting systems, the CEO wants to know more about management accounting. Considering the above, Discuss the usefulness of management accounting for merchandising and manufacturing companies like Pixar Ltd. (15 marks) (2) Prepare an income statement for Merchandising and Manufacturing divisions of Pixar Company Ltd for 2020 based on the data given above in (a). Show the cost of goods manufactured and cost of goods sold calculations clearly here. (25 marks) (3) Based on the cost and sale per unit information given above in (b). Compute BEP in Units (ii) Profit if output manufactured is 900 units. Show Profit statement here. (10 marks) (4) Estimate the operating income of Pixar Ltd using contribution margin approach for the next three months using the estimated figures given above in () (10 marks) (15+ 25 + 10 + 10 = 60 marks) Part A Manufacturing and Merchandising divisions of Pixar Ltd Pixar Ltd is one of the leading food processing companies in Gulf region. Food processing sector is indispensable for overall development of an economy as it provides a vital linkage and synergy between the agriculture and industry. It helps to diversify and commercialize farming: enhance income of farmers; create markets for export of Agro- foods as well as generate greater employment opportunities. The CEO wants to explore more about management accounting systems and its implementation within this company (a) Manufacturing and Merchandising Divisions of Pixar Ltd Pixar Ltd has two divisions of operations i.e., manufacturing division and merchandising division. The cost and Sales details of Manufacturing and Merchandising Divisions Information Sales Inventory Merchandising Division Manufacturing Division For the year Beginning Land of For the year Beginning 2020 ($) of 2020 2020 2020 of 2020 2020 (S) ($) (S) 800,000 1,200,000 140,000 150,000 70,000 65,000 (Materials) Materials) 700,000 700,000 Materials) 558,000 of Purchases inventory Direct Labor 166,000 Manufacturing Overheads WIP inventory 160,000 54,000 (zero) 120,000 Finished Goods inventory Administration Expenses 50,000 55,000 (b) Production and Cost detaik of one of the Products being manufactured by its Manufacturing Division Production and cost details of one of the products of Pixar. Ltd. is a given below: Information Sper unit Selling Price 500 Direct Material 300 300 (per unit of material) Direct Labour cost 550 per hour 150 Number of labour. hours needed to 6 hours manufacture one unit of product Fixed Costs for the company $ 40,000 3- c) Estimations Sales and Cost details for one of its products for the next 3 months The company has estimated its sales and production cost for one of its products for the next three months u below: Particulars Units expected to be sold May 40% more than March sales units March April 110,000 units 20% more than March sales units 40 45 15 per unit 15 per unit 800.000 Selling Price per unit) Variable cost per unit Fixed Cost for this period 50 15 per unit Required (1) As the company wants to implement management accounting systems, the CEO wants to know more about management accounting. Considering the above, Discuss the usefulness of management accounting for merchandising and manufacturing companies like Pixar Ltd. (15 marks) (2) Prepare an income statement for Merchandising and Manufacturing divisions of Pixar Company Ltd for 2020 based on the data given above in (a). Show the cost of goods manufactured and cost of goods sold calculations clearly here. (25 marks) (3) Based on the cost and sale per unit information given above in (b). Compute BEP in Units (ii) Profit if output manufactured is 900 units. Show Profit statement here. (10 marks) (4) Estimate the operating income of Pixar Ltd using contribution margin approach for the next three months using the estimated figures given above in () (10 marks) (15+ 25 + 10 + 10 = 60 marks)