INDUSTRIAL MANUFACTURING LTD Industrial Manufacturing Ltd is preparing its annua
ID: 2489095 • Letter: I
Question
INDUSTRIAL MANUFACTURING LTD Industrial Manufacturing Ltd is preparing its annual budget for the year ending 31 March 2017 Industrial Manufacturing Ltd produce a single product, a valve housing which the company labelled the ZK4X housing. This product is used by farmers in New Zealand. The company has currently captured 40% of the New Zealand market for this type of product. The production process involves the input of two major components of direct raw materials - Metal and Plastic. You are provided with the following information with which to prepare the company's master budget Statement of Financial Position as at 31 March 2016 (prepared on a variable costing contribution format) Current Assets Cash at Bank Accounts receivable (net) Inventory 9,200.00 95,890.00 - Metal (3,250kg x $8.60) 27,950.00 Plastic (650kg x $1.50) - ZK4X housing (390 units x $76) 975.00 2964000 58,565.00 Property Plant and Equipment Land Building less Accumulated Depreciation (2% pa straight line) Machinery and Equipment less Accumulated Depreciation (15% pa straight line) 300,000.00 17,400.00 150,000.00 24.600.00 100,000.00 282,600.00 125.400.00 508,000,00 671655.00 Total Assets Liabilities Accounts Payable Accrued administrative wages 39,675.00 800.00 40,475.00 Shareholders Funds Issued Capital Retained Earnings 400,000.00 231,180.00 631,180.00 Total Liabilities and Equity 671655.00 1 Sales The selling price is expected to remain at $107 per unit for the foreseeable futureExplanation / Answer
B50JB60TotalSales$ 8,469,300$ 5,678,400$ 14,147,700Cost of goodssold$ 5,242,900$ 4,461,600$ 9,704,500Gross profit$ 3,226,400$ 1,216,800$ 4,443,200Operating ExpensesSelling Expenses$ 662,900$ 361,100$ 1,024,000Administartive Expenses$ 541,500$ 342,100$ 883,600Total Operating Expenses$ 1,204,400$ 703,200$ 1,907,600Income From Operation$ 2,022,000$ 513,600$ 2,535,600Income Tax expenses$ 760,680Net Income(Loss)$ 1,774,920