Assignment 3
Due: Friday, 15 September 2023, 9:00 PM
[CONFIDENTIAL] [TURN OVER]
, MAC2601
SEPTEMBER 2023
QUESTION 1 (30 MARKS) (36 MINUTES)
INDEPENDENT PART A
You have been presented with information by the management accountant of Mzanzifashion (Pty) Ltd (“Mzanzi-
fashion”), a company that manufactures dresses. Mzanzifashion uses fabric to manufacture its dresses. The
management accountant has computed the value of fabric on 31 August 2023. The inventory value of fabric has been
calculated as follows using the First-in-first-out (FIFO) valuation method:
Date Receipts Issues Balance
Quantity Price Amount Quantity Price Amount Quantity Price Amount
Units R R Units R R Units R R
1 375 15 5 625
3 375 15 5 625
1 125 18 20 250 1 125 18 20 250
8 375 15 5 625
75 18 1 350 1 050 18 18 900
12 1 050 18 18 900
750 22 16 500 750 22 16 500
17 -300 18 -5 400 750 18 13 500
750 22 16 500
31 750 18 13 500 750 22 16 500
Additional information:
The management accountant also used the following in calculating the inventory value of fabric:
Date Transaction
3 Purchased material .
8 Issued material to production .
12 Purchased material.
17 Returned units purchased on the 3rd and was not yet issued
to production.
30 Issued material to production.
The management accountant has requested to be informed what the value of inventory
of fabric would be on 31 August 2023, if the Weighted average method of inventory
, MAC2601
SEPTEMBER 2023
valuation is used. Assume the details of opening inventory on 1 August 2023 would be
the same as for the FIFO method.
INDEPENDENT PART B
Dairy-land (Pty) Ltd (“Dairy-land”) is a company that manufactures dairy products.
The manufacturing of the products follows a joint process. The products undergo
further processing at split-off point.
The following information relates to the production for the month of April 2023:
Products Yield Selling price per
In kilograms kilogram of the final
product
(R )
Butter 20 000 25
Cheese 15 000 35
Cream 12 000 30
Costs of further processing:
Products Total Costs
(R )
Butter 100 000
Cheese 75 000
Cream 60 000
In the month of April, the products were manufactured at a joint cost of R470 000.
Dairyland allocates joint cost using the physical standard method.
During the joint manufacturing process, Dairy-land also produces a fermented by-
product called Amasi-wodumo, which is sold in 1-liter bottles. The product has a regular
market. In the month of April Dairy-land recorded a net realisable value of R100 000
for Amasiwodumo.
Due: Friday, 15 September 2023, 9:00 PM
[CONFIDENTIAL] [TURN OVER]
, MAC2601
SEPTEMBER 2023
QUESTION 1 (30 MARKS) (36 MINUTES)
INDEPENDENT PART A
You have been presented with information by the management accountant of Mzanzifashion (Pty) Ltd (“Mzanzi-
fashion”), a company that manufactures dresses. Mzanzifashion uses fabric to manufacture its dresses. The
management accountant has computed the value of fabric on 31 August 2023. The inventory value of fabric has been
calculated as follows using the First-in-first-out (FIFO) valuation method:
Date Receipts Issues Balance
Quantity Price Amount Quantity Price Amount Quantity Price Amount
Units R R Units R R Units R R
1 375 15 5 625
3 375 15 5 625
1 125 18 20 250 1 125 18 20 250
8 375 15 5 625
75 18 1 350 1 050 18 18 900
12 1 050 18 18 900
750 22 16 500 750 22 16 500
17 -300 18 -5 400 750 18 13 500
750 22 16 500
31 750 18 13 500 750 22 16 500
Additional information:
The management accountant also used the following in calculating the inventory value of fabric:
Date Transaction
3 Purchased material .
8 Issued material to production .
12 Purchased material.
17 Returned units purchased on the 3rd and was not yet issued
to production.
30 Issued material to production.
The management accountant has requested to be informed what the value of inventory
of fabric would be on 31 August 2023, if the Weighted average method of inventory
, MAC2601
SEPTEMBER 2023
valuation is used. Assume the details of opening inventory on 1 August 2023 would be
the same as for the FIFO method.
INDEPENDENT PART B
Dairy-land (Pty) Ltd (“Dairy-land”) is a company that manufactures dairy products.
The manufacturing of the products follows a joint process. The products undergo
further processing at split-off point.
The following information relates to the production for the month of April 2023:
Products Yield Selling price per
In kilograms kilogram of the final
product
(R )
Butter 20 000 25
Cheese 15 000 35
Cream 12 000 30
Costs of further processing:
Products Total Costs
(R )
Butter 100 000
Cheese 75 000
Cream 60 000
In the month of April, the products were manufactured at a joint cost of R470 000.
Dairyland allocates joint cost using the physical standard method.
During the joint manufacturing process, Dairy-land also produces a fermented by-
product called Amasi-wodumo, which is sold in 1-liter bottles. The product has a regular
market. In the month of April Dairy-land recorded a net realisable value of R100 000
for Amasiwodumo.
