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QUESTION $5$

$(20$ Marks$)$

Based on the information provided below, answer the following questions.

GreenTech Manufacturing Ltd$.($GTM$)$ is a mid$-$sized company that produces a range of eco$-$friendly, energy$-$efficient washing machines for residential use. As a forward$-$thinking company, GTM has embedded Sustainable Development Goal $($SDG$)12-$ Responsible Consumption and Production $-$ into its core business strategy. The company is focused on reducing its environmental impact, ensuring responsible production practices, and supporting community development initiatives through Corporate Social Investment $($CSI$).$

Mission Statement:

GTM is committed to producing energy$-$efficient products with minimal environmental impact, fostering a sustainable future for both the planet and the local communities. The company supports SDG $12$ by reducing waste in the production process, optimising resource utilisation, and providing jobs to local communities through training and development programmes.

Financial and Non$-$Financial Data:

Financial Data:

Sales Forecast $($Units for June $-$ September $2025)$

June: $100,000$

July: $150,000$ units

August: $120,000$ units

September: $130,000$ units

Sales Revenue

With an average selling price per unit of the washing machines at R$1,500,$ total revenue for each month is as follows:

June: R$150,000,000$

July: R$225,000,000$

August: R$180,000,000$

September: R$195,000,000$

Production Costs

Direct material cost per unit: R$800$

Direct labor cost per unit $($payable in the month in which it is incurred$)$: R$500$

Variable overhead per unit: R$200$

Fixed overhead $($monthly$)$: R$3,000,000($including depreciation of R$600,000)$

Sustainability Investments

GTM has committed to investing in more energy$-$efficient manufacturing equipment and technology to align with SDG $12.$

The total investment in new, sustainable technology for Q$32025$ is R$10,000,000($payable in August$).$ This investment will help reduce energy consumption and carbon emissions in production$\mathrm{.}14$:$08$

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$3.$ Production Costs

Direct material cost per unit: R$800$

Direct labor cost per unit $($payable in the month in which it is incurred$)$: R$500$

Variable overhead per unit: R$200$

Fixed overhead $($monthly$)$: R$3,000,000($including depreciation of R$600,000)$

Sustainability Investments

GTM has committed to investing in more energy$-$efficient manufacturing equipment and technology to align with SDG $12.$

The total investment in new, sustainable technology for Q$32025$ is R$10,000,000($payable in August$).$ This investment will help reduce energy consumption and carbon emissions in production.

Purchasing and Supplier Payments

Direct materials are purchased on a $50\%$ credit basis and $50\%$ paid immediately.

Credit purchases of direct materials are paid in the following month after the month of purchase.

GTM has developed partnerships with local, sustainable raw material suppliers that adhere to environmental standards, reinforcing the company's commitment to SDG $12.$

Cash Flow Forecast

Cash Sales: $30\%$ of total sales

Credit Sales: $70\%$ of total sales, collected in the following month

Opening Cash Balance on July $1,2025$: R$40,000,000$

CSI Contributions: GTM donates part of its profits to community development initiatives, specifically aimed at improving educational infrastructure and sustainable farming projects in local communities. As part of its commitment to Corporate Social Investment $($CSI$),$ GTM has initiated a new project in partnership with a local school to build a solar$-$powered education centre. This centre, which will focus on renewable energy education and promoting environmentally conscious practices, is expected to offer free after$-$school programmes. The project is expected to cost R$2,500,000$ and will be funded from the company's CSI budget. The cash payment for this project is planned for September $2025.$

Non$-$Financial Data:

Sustainable Production Practices

GTM has implemented a comprehensive waste reduction program in its production processes, aiming to recycle $90\%$ of manufacturing waste by $2025.$ The company also ensures that all its products are made from recyclable materials, with minimal packaging.

Employee Training and Development

GTM places a significant focus on employee skills development. The company runs quarterly training programs aimed at upskilling employees in both manufacturing techniques and environmental best practices, contributing to the Community Engagement goals under SDG $8($Decent Work and Economic Growth$)\mathrm{.}14$:$08$

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Community Engagement $($CSI$)$

GTM is deeply committed to Corporate Social Investment $($CSI$)$ as evidenced by the new project in partnersh