Assignment 2 Question 1 25 Marks The condensed balance sheet of a manufacturing company on 31 December 2018 was as follows: BALANCE SHEET AS AT 31 DECEMBER 2018 NS NS ASSETS 312 000 Non-current assets Land and buildings 200 000 Machinery 60 000 12 000 Furniture Vehicles 40 000 60 000 Current Assets 5 000 Inventory - Material A - Material B 2 000 16 000 Completed goods 30 000 Debtors 7 000 Bank 372 000 Total assets EQUITY AND LIABILITIES 346 000 Equity 320 000 Share capital 26 000 Retained income 26 000 Current liabilities 6 000 Creditors 20000 Provision for taxation 372 000 Total Equity and Liabilities The following details are planned for 2019: Only a single product is manufactured and its composition according to standard is as follows: NS 2 kg Material A NS2.50 5.00 Material B 4 kg @ NS0.50 2.00 Labor 2 hours NS3.00 6.00 Overheads 2 hours NSI.50 3.00 16.00 Estimated sales 11 000 items a N$20, 00 each. Desired closing stock: NS Material A 6 000 - Material B 3 000 Work-in-process - Completed goods 25 600 Selling costs 4 400 Administration costs 10 000 Provision for depreciation is to be calculated as follows: Machinery 10% on cost Furniture 5% on cost Vehicles 10% on cost Company taxation 40% The credit period granted by the suppliers and the delay in payment of debtors can be taken as one month. Required: Prepare the following budgets: Budget Marks Sales budget 1.1 Production budget (units) 1.2. 5 Purchase budget 1.3 10 Labour budget 1.4 1 1.5 Overhead budget 7 Cost of sales budget 1.6