word count is 200

QUESTION 1 "Hats of Oman" is a manufacturing business specialising in the manufacture of traditional Omani Kumas (embroidery hats). Budgeted data for the financial year ending 31 December 2019 is given below: Budgeted Data Budgeted Sales and Production Volume 50,000 Standard Selling Price per Unit 40.00 Standard Material Cost per Unit 8.00 Standard Direct Labour Cost per Unit 10.00 Budgeted Annual Fixed Production Overhead 250,000 Budgeted Annual Fixed Selling and Administrative Costs 130,000 At the end of 2019, the actual results for the business was as follows (based on actual production and sales of 48,000 units): Revenue Materials Labour Contribution Annual Fixed Production Overhead Fixed Selling and Administrative Costs Operating Profit 1,776,000.00 360,000.00 384,000.00 1,032,000.00 220,000.00 100,000.00 712,000.00 (d) The directors of "Hats of Oman' are unsure about the benefits of preparing budgets and have argued that they are too time consuming and waste too much of the accountant's time. They have asked you to write a Memo advising them on whether their accountant should continue to prepare budgets or not Word Count