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Prepare a cash budget showing a schedule of cash receipts Prepare a variance analysis Requirements :
This assignment requires students to:
Prepare a cash budget showing a schedule of cash receipts
Prepare a variance analysis
Students are required to complete the assignment individually.
Complete Part A and B (see below).
A hardcopy of the assignment is to be submitted with a Griffith College assignment coversheet at the start of class in week 11.
Please do not bind your assignment. Staple the assignment in the top left-hand corner.
Part A – Practical Question (4 Marks)
Archies Pty Ltd is preparing a cash budget for October, 2016. The following information relates to sales and purchases for the business:
a) The sales are made up of 20% cash sales and 80% on credit.
b) 35% of invoices are collected in the month they are invoiced. 60% are
collected in the month after the sale and 5% are uncollectible
Prepare the following schedules for Archies Pty Ltd for October, 2016:
i.Cash collections schedule
Projected monthly sales are:
Part B – Practical Question (6 Marks)
Markons Pty Ltd make household products which they sell to shops and households. One of its most popular products is a cleaning detergent called Sparkle. Markons Pty Ltd use a traditional standard costing system and below are the materials, and labour standard costs to produce one box of Sparkle detergent.
Direct Materials 1.5 kg @ $12 per kg$18.00
Direct manufacturing labour 0.5 hr @ $24 per hr$12.00
During the year 4000 boxes of Sparkle detergent were produced and sold. The actual costs of materials and labour to produce 4000 boxes were as follows:-
Direct materials 6500 kg @11.50 per kg$74,750
Direct manufacturing labour1960 hrs @ $25 per hr$49,000
i.Calculate price and efficiency variances for direct materials and direct manufacturing
Labour variances (4 marks)
ii.Explain one reason for each of the material and labour variances (2 marks)