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Question 5 (30 marks) Astrid Scheid Ltd manufactures kitchen cupboards. The company's budget for fixed costs per month is 7,500 and budgeted variable costs per cupboard are Direct materials Direct labour Variable overheads 5 hours at 3 per labour hour 15 sq metres at 4.50 per sq metre 5 hours at 6 per hour 67.50 30.00 15.00 The company had budgeted to make and sell 1,000 cupboards per month at a selling price of 150 each. However, in June, the actual figures were as follows: Sales Direct materials Direct labour Variable overheads Fixed overheads 1,400 units 22,000 sq metre 6,800 hours 6,800 hours 212,800 121,000 34,000 15,000 6,000 You are required to: a. Prepare the original and flexed budgets for June. (7 marks) Prepare a performance report reconciling the original budgeted profit to the actual profit showing all the variances arising. b. (14 marks) c. Write a report advising management on your findings and possible reasons why each variance arose (9 marks) Total: 30 Marks END Question 5 (30 marks) Astrid Scheid Ltd manufactures kitchen cupboards. The company's budget for fixed costs per month is 7,500 and budgeted variable costs per cupboard are Direct materials Direct labour Variable overheads 5 hours at 3 per labour hour 15 sq metres at 4.50 per sq metre 5 hours at 6 per hour 67.50 30.00 15.00 The company had budgeted to make and sell 1,000 cupboards per month at a selling price of 150 each. However, in June, the actual figures were as follows: Sales Direct materials Direct labour Variable overheads Fixed overheads 1,400 units 22,000 sq metre 6,800 hours 6,800 hours 212,800 121,000 34,000 15,000 6,000 You are required to: a. Prepare the original and flexed budgets for June. (7 marks) Prepare a performance report reconciling the original budgeted profit to the actual profit showing all the variances arising. b. (14 marks) c. Write a report advising management on your findings and possible reasons why each variance arose (9 marks) Total: 30 Marks END

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