QUESTION $1(49$ marks$)$ Primark Ltd is the manufacturer of the very popular, Prima energy drink. Primark Ltd has a $30$ June financial year$-$end. Primark Ltd$$s manufacturing process follows the following basic steps: Step $1$: Convert raw materials into the Prima energy drink. Step $2$: Transfer the Prima energy drink to the bottle. Step $3$: Seal the bottle. Step $4$: Perform a quality check. Step $5$: Apply the label on the bottle. After the label application $($Step $5),$ the Prima energy drinks are ready for sale. The following relates to Primark Ltd$$s inventory classes: Inventory class Description Cost formula used Raw materials Ingredients used to manufacture Prima energy drink Weighted average cost Packing materials Bottles and labels used for Prima energy drink First$-$in$-$first$-$out Work$-$in$-$progress Prima energy drinks completed up until Step $4$ of the manufacturing process First$-$in$-$first$-$out Finished goods Completed Prima energy drinks ready for sale First$-$in$-$first$-$out Additional note on work$-$in$-$progress: It is Primark Ltd$$s policy that all work$-$in$-$progress at year$-$end must be completed up until Step $4$ of the manufacturing process, i$.$e$.,$ the only thing outstanding is applying the label to the bottles, following which, the energy drinks will be completed and ready for sale. ANNEXURE I: FORMATIVE ASSESSMENT $293$ HFAC$231-1-$Jan$-$Jun$2025-$FA$2-$CP$-$V$3-10122024$ Raw materials: $$ Primark Ltd had $22000$ liters of raw materials on hand on $1$ July $2024$ with a total value of R$110000.$ Primark Ltd made the following raw material purchases during the $2025$ financial year: Liters Rand $500002250006500031200047000236200$ Primark Ltd had $8000$ liters of raw materials on hand on $30$ June $2025.2$ liters of raw materials are used to produce $1$ bottle of Prima energy drink. $$ No raw materials were spilled or lost during the $2025$ financial year$$s production. Packing material $$ bottles: $$ Primark Ltd had $100000$ bottles on hand on $1$ July $2024$ at a cost of R$1\mathrm{.}25$ per bottle. $$ Due to a big sale by the bottle supplier, Primark Ltd bought a substantial number of bottles during their $2024$ financial year. Therefore, they were not required to purchase any bottles during the $2025$ financial year. Packing material $$ labels: $$ Primark Ltd had $2000$ labels on hand on $1$ July $2024$ at a cost of R$1\mathrm{.}00$ per label. $$ Primark Ltd purchased $95000$ labels at R$1\mathrm{.}10$ per label on $5$ July $2024.$ Work$-$in$-$progress: $$ Primark Ltd had $2000$ bottles of Prima energy drink on hand on $1$ July $2024$ at a total cost of R$38500.$ Primark Ltd had $3500$ bottles of Prima energy drink in work$-$in$-$progress on $30$ June $2025.$ ANNEXURE I: FORMATIVE ASSESSMENT $294$ HFAC$231-1-$Jan$-$Jun$2025-$FA$2-$CP$-$V$3-10122024$ Manufacturing costs: Primark Ltd incurred the following manufacturing costs during the $2025$ financial year: Notes Rand Fixed overheads $1360000$ Variable overheads Salaries and wages $2215111$ Electricity and water $3149600$ Factory rent $348400$ Quality check costs $417600$ Notes: $1.$ Primark Ltd has a normal production capacity of $90000$ bottles of Prima energy drinks per year. $2.90\%$ of the salaries and wages are related to the manufacturing process, and the remaining $10\%$ relates to the administration process. $3.100\%$ of the expense related to the manufacturing process. $4.$ Quality check costs relate to ensuring that all bottles of Prima energy drink are properly sealed and all quality checks happen right before the final step, which is adding the Prima energy drink label to the bottle. Finished goods: $$ Primark Ltd had $10000$ Prima energy drinks on hand on $1$ July $2024$ with a total cost of R$210000.$ Primark Ltd had $15000$ Prima energy drinks on hand on $30$ June $2025.$ Additional information: A new competitor entered the energy drink market, and for this reason, the selling price of a completed Prima energy drink was estimated to be R$19$ per bottle on $30$ June $2025.$ No additional selling costs would need to be incurred. ANNEXURE I: FORMATIVE ASSESSMENT $295$ HFAC$231-1-$Jan$-$Jun$2025-$FA$2-$CP$-$V$3-10122024$ REQUIRED: $1\mathrm{.}1$ Prepare the inventory note disclosing the balances of each individual category of inventory for Primark Ltd for the year ending $30$ June $2025.$ Include detailed calculations and considerations for each category. $$ Round all answers to two decimals. $$ Your answer must comply with the requirements of IAS $2$: Inventories. $$ Accounting policy notes are not required. $$ Comparative figures are not required. $$ Ignore all tax implications. $(34$ marks$)$ Communication skill: Presentation $(1$ mark$)1\mathrm{.}2$ Calculate the cost of sales figure that would need to be disclosed in the Statement of Profit or Loss and Other Comprehensive Income for Primark Ltd for the year ended $30$ June $2025.(14$ marks$)$