MAC3701
Assignment 2
Semester 2
2024 - DUE 9
September
2024
[Type the document subtitle]
[Pick the date]
[Type the company name]
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Principles of Management Accounting
MAC3701 Assignment 2 (COMPLETE ANSWERS) Semester 2 2024 - DUE 9
September 2024 ; 100% TRUSTED Complete, trusted solutions and
explanations....
Company information Pinatech (Pty) Ltd (“Pina”), based in Isando, Gauteng,
has a male-dominated executive team and manufactures two types of
premium laptop models: 14-inch Deluxe and 16-inch Elite laptops (one laptop
is equal to one unit) for professionals and gamers. Their products are known
for superior performance and quality; hence, their laptops carry an above-
industry four-year warranty. The company has a strong brand reputation and a
loyal customer base. The company has a December financial year end, uses
an absorption costing system, and values all its inventories using the first-in-
first-out (FIFO) method. Pina’s operations occur in two production stages,
firstly the enclosure stage and then the assembly stage. Enclosure stage
Using advanced machinery and semi-skilled labour, this stage combines
aluminium and magnesium alloys to mould and produce high-end, durable
laptop casings. Assembly stage During this stage, highly skilled technical
labourers carefully install the main circuit board and advanced component
sets into the enclosure. Both production stages are complex and time-
consuming and are managed by only one factory supervisor who monitors
both operations and reports back to the production head. The company
operates at only 75% production capacity and has opportunities to sell laptop
casings as an additional product line. The company has been facing
challenges from intense competition in a saturated market. Additionally, Pina
relies on a global supply chain to source its critical raw materials, aluminium
and magnesium. Recent geopolitical tensions and trade restrictions have led
to delays and increased costs for these critical raw materials. The company
was recently awarded a City of Ekurhuleni tender to supply the various
departments with laptops. Pina received this tender after sponsoring a charity
event hosted by an influential city government official. Page 3 of 9 MAC3701
Assessment 02/S2/2024 [TURN OVER] PART A (20 Marks; 36 Minutes)
During the 2023 financial year, a standard costing system was in place, and
the following information was extracted from Pina’s actual and budgeted
