Question 01: Kenosha Winter Services is a small family owned snow removal business for services the company has always charged a flat fee per hundred square meters of now removal. The current tee is 52 per hundred square meters. However, there is some question about whether the company is actually making any money on jobs for some customers particularly those located on more remote properties that require considerable travel time. The owner's daughter, home from school for the Summer, has surested investigating this question using ABC. Aber some discussion, a simple system consisting of four activity cost poole seemed to be adequate. The activity cast pools and their activity Activity Cast Pool Activity Measure Activity for the Year The total cost for operating the comany for the year is $624,000 which indudes the following costs: Snow.removalec pet depon ompositions dibuted across the activities as follows: la support consists of receiving calls from potential customers at the home office scheduling jobs, biling 2. Prepare the first stage allocation of costs to the activity cost pools, 4 Marks Croute the activity rates for the activity 15 Marks c. The company recently completed a 3.500 square metre now removal job at Home Hardware-a 70-kilometre round-trip journey from Kenosha's offices Compute the cost of this using the ABC system, Marks! d the revenue from the Hometown Hardware job was 5735 3.500 square meters at 521 per hundred square meters. Prepare a report showing the margin from this job. 16 Marks] Question 02: Franklin Products Limited manufactures and distributes a number of products to retailers. One of these products, SuperStick, requires five kilograms of material D236 in the manufacture of each unit. The company is now planning raw materials needs for the third quarter-July, August, and September. Peak sales of SuperStick occur in the third quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 5,000 units plus 25% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 21,000 units. b. The raw materials inventory on hand at the end of each month must be equal to 40% of the following month's production needs for raw materials. The raw materials inventory on June 30 for material D236 is budgeted to be 160,000 kilograms. c. The company maintains no work in process inventories. A sales budget for Super Stick for the last six months of the year follows: Budgeted Sales in Units July.... August September.... October......... November......... December 60000 75.000 105.000 53000 30000 15.000 I. Prepare a production budget for SuperStick for July, August, September, and October. [4 Marks) Prepare a direct materials purchases budget showing the quantity of material D236 to be purchased for July, August, and September and for the quarter in total. [4 Marks) Question 01: Kenosha Winter Services is a small family owned snow removal business for services the company has always charged a flat fee per hundred square meters of now removal. The current tee is 52 per hundred square meters. However, there is some question about whether the company is actually making any money on jobs for some customers particularly those located on more remote properties that require considerable travel time. The owner's daughter, home from school for the Summer, has surested investigating this question using ABC. Aber some discussion, a simple system consisting of four activity cost poole seemed to be adequate. The activity cast pools and their activity Activity Cast Pool Activity Measure Activity for the Year The total cost for operating the comany for the year is $624,000 which indudes the following costs: Snow.removalec pet depon ompositions dibuted across the activities as follows: la support consists of receiving calls from potential customers at the home office scheduling jobs, biling 2. Prepare the first stage allocation of costs to the activity cost pools, 4 Marks Croute the activity rates for the activity 15 Marks c. The company recently completed a 3.500 square metre now removal job at Home Hardware-a 70-kilometre round-trip journey from Kenosha's offices Compute the cost of this using the ABC system, Marks! d the revenue from the Hometown Hardware job was 5735 3.500 square meters at 521 per hundred square meters. Prepare a report showing the margin from this job. 16 Marks] Question 02: Franklin Products Limited manufactures and distributes a number of products to retailers. One of these products, SuperStick, requires five kilograms of material D236 in the manufacture of each unit. The company is now planning raw materials needs for the third quarter-July, August, and September. Peak sales of SuperStick occur in the third quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 5,000 units plus 25% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 21,000 units. b. The raw materials inventory on hand at the end of each month must be equal to 40% of the following month's production needs for raw materials. The raw materials inventory on June 30 for material D236 is budgeted to be 160,000 kilograms. c. The company maintains no work in process inventories. A sales budget for Super Stick for the last six months of the year follows: Budgeted Sales in Units July.... August September.... October......... November......... December 60000 75.000 105.000 53000 30000 15.000 I. Prepare a production budget for SuperStick for July, August, September, and October. [4 Marks) Prepare a direct materials purchases budget showing the quantity of material D236 to be purchased for July, August, and September and for the quarter in total. [4 Marks)