3.0 ANALYSIS ON CASE STUDY 3.1 Discuss two financial and non-financial performances of Jungle Co for the year ending 31 December 2021. 3.2 Draft the following budgets of Bags4All for the months: June, July and August 2021 (refer to Note 1) (i) Production budget (ii) Material purchase budget (both materials) (iii) Variable overhead budget 3.3 Refer to Note 3 and complete the cash budget for exported products, for the months May, June and July 2021. (Sales are expected to be 326 for Handbags and 453 for Satchel per month) 3.4 Discuss three reasons why management of Bags4All should set a cash budget. 3.5 Discuss any four non-monetary considerations that Bags4All should take into account before exporting its products. REFERENCES (New Page) APPENDIXES (New Page) Note 1: Budget to produce the PinkWorths bag Before further negotiations are entered into with the directors of PinkWorths Ltd, a master budget must be set in order to estimate the cost associated with this business venture. PinkWorths Ltd indicated that it will buy approximately 5 000 of the PinkWorths bags from Bags4All on annual basis. The monthly sales distribution is expected to be as shown in Table 5. Table 5: The expected monthly sales distribution Month Jan Feb Mar Apr May Jun 2021 2021 2021 2021 2021 2021 Sales units 300 400 420 420 250 400 Month Jul Aug Sep Oct Nov Dec 2021 2021 2021 2021 2021 2021 Sales units 400 420 300 300 700 270 PinkWorths Ltd is willing to pay R600 per bag. It is policy for Bags4All to maintain closing finished goods at a level that is equal to 40% of the next month's demand. The material required per handbag is shown in the following table 6. Table 6: Material required per handbag Leather Crystals Material requirement per 1.5 metre per bag 25 crystals per bag PinkWorths bag Cost R180 per metre R3 per crystal It takes 30 minutes to produce a handbag. Material is produced on a just-in-time (JIT) basis and no such inventories are kept readily on hand. The crystals are sewn to the handbags by hand with the upmost care. Direct labourers earn R200 per hour. Variable overheads are allocated on the basis of direct labour hours. Variable overheads are shown in the following table 7. Note 1: Budget to produce the PinkWorths bag Before further negotiations are entered into with the directors of PinkWorths Ltd, a master budget must be set in order to estimate the cost associated with this business venture. PinkWorths Ltd indicated that it will buy approximately 5 000 of the PinkWorths bags from Bags4All on annual basis. The monthly sales distribution is expected to be as shown in Table 5. Table 5: The expected monthly sales distribution Month Jan Feb Mar Apr May Jun 2021 2021 2021 2021 2021 2021 Sales units 300 400 420 420 250 400 Month Jul Aug Sep Oct Nov Dec 2021 2021 2021 2021 2021 2021 Sales units 400 420 300 300 700 270 PinkWorths Ltd is willing to pay R600 per bag. It is policy for Bags4All to maintain closing finished goods at a level that is equal to 40% of the next month's demand. The material required per handbag is shown in the following table 6. Table 6: Material required per handbag Leather Crystals Material requirement per 1.5 metre per bag 25 crystals per bag PinkWorths bag Cost R180 per metre R3 per crystal It takes 30 minutes to produce a handbag. Material is produced on a just-in-time (JIT) basis and no such inventories are kept readily on hand. The crystals are sewn to the handbags by hand with the upmost care. Direct labourers earn R200 per hour. Variable overheads are allocated on the basis of direct labour hours. Variable overheads are shown in the following table 7