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Question 1 (15 marks; 27 minutes) You are required to answer the following short questions for the Military Academy Management Team: The following information pertains
Question 1 (15 marks; 27 minutes) You are required to answer the following short questions for the Military Academy Management Team: The following information pertains to Question 1.1: The Transport Section at the Military Academy's maintenance costs for its busses over the past eight years, along with its total distance travelled in kilometres are as follows: (5)1 The following information pertains to Question 1.2: Military Academy Quarter-master Section (MAQS) suffered major losses in a fire on 18 April 2022. In addition to destroying several buildings, the blaze destroyed the work-in-process inventory for an entire product line being developed by the Technical Services Section (TSS) stored at the MAQS. Fortunately, the TSS was insured; however, it needs to substantiate the amount of the claim. To this end, the TSS has gathered the following information that pertains to production and sales of the affected product line: a. The company's sales for the first 18 days of April amounted to R920 000. Normally, this product line generates a gross profit equal to 30% of sales. b. Finished Goods inventory was R116 000 on 1 April and R170 000 on 18 April. c. On 1 April, Work-in-process inventory was R192 000 . d. During the first 18 days of April, the company incurred the following costs: Direct materials used R304 000 Direct labour R176000 R168000 Manufacturing overhead R168000 Required: 1.2 Determine the value of Work-in-process inventory that was destroyed by the fire, assuming TSS uses an actual cost system. The following information pertains to Question 1.3: Below is the Statement of Profit or Loss of January and February 2022 of the Saldanha Sickbay: The following cost payment pattern is determined through the use of the high-low method, with the assumption that 4000 patients were treated in January and 4800 patients in February. The maintenance of medical records is a mixed cost item which includes fixed monthly fees of R200 and a variable charge of R0.25 per patient visit. Required: 1.3 Calculate the number of patients that the sickbay must treat to break even in the month of February, assuming that there are no changes in the cost/income structure. (3)
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