15. MAF151 JULY 2021-1 PDF

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UNIVERSITI TEKNOLOGI MARAFINAL ASSESSMENTANSWER SCHEMECOURSE : FUNDAMENTALS OF COST ACCOUNTINGCOURSE CODE : MAFEXAMINATION : JULY 2021SUGGESTED SOLUTIONSOLUTION 1A a. i. semi-variable cost√ ii. indirect non production cost√ iii. direct expenses√ iv. variable cost√ (√4x1= 4 marks) b. PRIME COST PERIO...

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AC/JUL 2021/MAF151

UNIVERSITI TEKNOLOGI MARA FINAL ASSESSMENT ANSWER SCHEME

COURSE

:

FUNDAMENTALS OF COST ACCOUNTING

COURSE CODE

:

MAF151

EXAMINATION

:

JULY 2021

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AC/JUL 2021/MAF151

SUGGESTED SOLUTION SOLUTION 1 A

i. semi-variable cost√ ii. indirect non production cost√ iii. direct expenses√ iv. variable cost√

a.

(√4x1= 4 marks) b. PRIME COST Raw materials + carriage inwards - return to supplier Production staff salaries

PERIOD COST RM 16,000√ 350√ 1,000√ 20,000√ 35,350

RM 500√ 1,200√ 4,400√ 1,320√ 7,420 (√8x½= 4 marks) (Total: 8 marks)

Advertising Electricity (30%) Salesman commission Depreciation (40%)

SOLUTION 2 A. a. Material Requisition Note is a document used by the production department to request materials they need to complete a manufacturing process. √ Purchase Requisition Note is a document used by a department (store) to request the purchasing department order materials for stock replenishment. √ Goods Received Note is a record by Receiving Department on goods received from suppliers to check against purchase order as a proof that ordered products received. √

(3 marks) b. i. ii.

JIT is a demand driven approach where materials are purchased only when demand is required. √ -

Avoid inventory from exceeding demand. √ Have zero breakdowns. √ Have a strong producer-supplier relationship. Any other acceptable points (3 marks)

B. a. Economic Order Quantity (using formula) √√ (1%x25) √ = 8,000 packs

b. Re-Order Level = MxU x MxLT = 7,500√ x 1 √ = 7,500 packs © Hak Cipta Universiti Teknologi MARA

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AC/JUL 2021/MAF151

c. Maximum Stock Level = ROL + EOQ – (MnU x MnLT) = 7,500√of + 8,000√of – (3,000 √x 0.5√) = 14,000 packs d. Minimum Stock Level = ROL – (AvU x AvLT) = 7,500√of – (5,250√ x 0.75√) = 3,563 packs (√12 x ½) = 6 marks C. Date June 1

QTY

3

400

RECEIPT CPU Amount

12.5

5000√

10

18 20

150 100 250 650

13

8450√

Return to supplier

22 29

QTY

80 150 450

500

13.4

6700√

30

Stock loss

30

Closing stock

20

ISSUE BALANCE CPU Amount QTY CPU Amount 1650√ 150 11 100 12 1200 250 2850 150 11 1650 100 12 1200 400 12.5 5000 1650√ 11 1200√ 12 12.5 3125√ 150 12.5 1875 150 12.5 1875 650 13 8450 1040√ 13 150 12.5 1875 570 13 7410 12.5 1875√ 5850√ 13 120 13 1560 120 13 1560 500 13.4 6700 260√ 13 100 13 1300 500 13.40 6700 8000√ 600 (√12 x ½) = 6 marks (Total: 18 marks)

SOLUTION 3 ALISYA ENTERPRISE a.

The gross wages for Inara and Ashraf in Week 1 (Time-based scheme).

1. Basic Wages = NWH x Rate/hour

Inara (52 hours) = 40 hours√ x RM8.50√ = RM340

Ashraf (38 hours) = 38 hours√ x RM8.50√ = RM323

2. Overtime (OT Rate = 160%) a. OT Hours b. OT Basic c. OT Premium Overtime Pay

= 52 – 40 = 12 hours√ = 12 x 1 x 8.50 = 102.00√ = 12 x 0.6 x 8.50 = 61.20√ RM163.20

= 32 – 40 = 0 (No overtime) √

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3. Bonus a. Good unit produced b. Time Allowed (TA) c. Time Taken (TT) d. Time Saved (TS) e. Bonus Pay = TS x 0.6 x Rate/hour Gross Wages

b.

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= 290 – 10 = 280 units = 15/60 x 280 = 70 hours√ = 52 hours = 70 – 52 = 18 hours√ = 18 x 0.6 x 8.50 = RM91.80√

= 200 – 10 = 190 units = 15/60 x 190 = 47.5 hours√ = 38 hours = 47.5 – 38 = 9.5 hours√ = 9.5 x 0.6 x 8.50 = RM48.45√

= 340 + 163.20 + 91.80 = RM595.00√of

= 323 + 0 + 48.45 = RM371.45√of

(16√ x ½ = 8 marks) The gross wages for Inara and Ashraf in Week 1 (Piecework scheme with GMW = RM300).

Good unit produced Basic Wages

Guaranteed Minimum Wages Basic Bonus Gross Wages Paid

Inara = 290 – 10 = 280 units√ = 280 x RM1.40 = RM392√

Ashraf = 200 – 10 = 190 units√ = 190 x RM1.40 = RM266√

RM300

RM300

RM392 √ RM91.80

RM300 √ RM48.45

RM483.80 √

RM348.45 √ (8√ x 1 = 8 marks)

c.

TWO (2) examples each for prevention cost and replacement cost. Prevention Cost: 1.

Providing a stimulating and safe workplace environment. √

2.

Continuous training and reinforcement to develops a work force that is competent, consistent, competitive, effective and efficient. √

3.

Doing an effective interview and hiring process exposing new hires to an explanation of the company, so individuals know whether the job is their best choice.

4.

Showing the employees that they are valuable through information or recognition rewards, making them feel included.

5.

Offering promotion opportunities and the review of the rate of pay to make sure it is competitive.

Other relevant answers. (Choose any 2) © Hak Cipta Universiti Teknologi MARA

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Replacement Cost: 1.

An increase in recruitment and selection costs. √

2.

Induction and training costs will increase. √

3.

Loss of know-how and customer goodwill. Other relevant answers (Choose any 2) (4 x 1 = 4 marks) (Total: 20 marks)

SOLUTION 4 A. a) i. Overhead Analysis Sheet Overhead item

Basis

Indirect materials

Direct allocation √ Direct allocation Machine value√ Floor area√ No of employee√ Floor area√

Indirect wages Depreciation machinery Rent Supervision

on

Insurance on building Total Re apportionment Maintenance Store

Total (RM) 20,500

Mixing (RM) 6,000√

Baking (RM) 9,000√

Maintenance (RM) 2,500√

Store (RM) 3,000√

20,000

5,000

11,000

2,000

2,000

6,000

3,643√

2,357√

-

-

8,000 5,400

3,500√ 2,160√

2,500√ 1,800√

1,000√ 720√

1,000√ 720√

6,000

2,625√

1,875√

750√

750√

65,900

22,928

28,532

6,970

7,470

Maintenance hours√

3,834

2,788

(6,970) √ of

348

No of material requisition√

3,909

3,440

469

(7,818) of

258 12 1 30,942

188 10 34,958

(469) √ of 1 (1) √ of -

23 (23) √ of -

Maintenance Store Maintenance TOTAL OVERHEAD

65,900

(30√ x ½ = 15 marks) ii. Overhead absorption rate (OAR) Mixing

= 30,942√ OF 2,880√ = RM10.74 per machine hour√

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Baking

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= 34,958√ OF 2,250√ = RM15.54 per machine hour√

(6√ x ½ - 3 marks) b) One suitable basis of apportionment for each of the following expenses: i. Depreciation of equipment – Value of equipment√ ii. Fire insurance – Floor area√ iii. Canteen expenses – number of employee√ iv. Material handling expenses – Number of material requisition notes√ Or other suitable basis (1 marks each x 4 = 4 marks) 4(B): YY Sdn Bhd a.

The Activity-based Overhead Rate (ABOR)

Activity Cost Pool Purchasing

Estimated Overhead (RM) 240,000

Assembling

525,000

Packaging

100,000

Quality inspection

72,500

Total Cost Driver 1,200 purchase orders (400 + 800) 37,500 hours (1.5 x 5000) + (2 x 15000) 20,000 units (5000 + 15000) 725 inspections (200 + 525)

ABOR (RM) RM200/purchase order√√ RM14/direct labor hour√√ RM5/units produced√√ RM100/inspection√√ (8√ x ½ = 4marks)

b.

The product cost per unit for product ‘Gold A’ – ABC System. Activity Cost Pool Purchasing Assembling Packaging Quality inspection

ABOR (RM) x Cost Driver = 200 x 400 PO = 14 x 7500 DLH = 5 x 5000 units = 100 x 200 inspections Total Overheads ÷ Units produces Overhead/unit + Direct material + Direct labor Product Cost/unit

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Amount (RM) 80,000√ 105,000√ 25,000√ 20,000√ 230,000 ÷ 5,000 units√ 46.00√of 20.00 √ 18.00 84.00√of (8√ x ½ = 4 marks)

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c.

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Evaluate the product cost per unit of ‘Gold A’ under the Traditional costing system and Activity-based costing system.

Direct material Direct labor Overheads

Traditional (RM) 20.00 18.00 37.50 (25 X 1.5 DLH) 75.50√

ABC (RM) 20.00 18.00 46.00 84.00

Evaluation: Product ‘Gold A’ is under costed by RM8.50 per unit√ of (RM84 – 75.50) under the traditional system compared to ABC system due to the usage of DLH as a single cost driver√ which is not as accurate as the usage of multiple cost drivers under ABC system. √ (4√ x ½ = 2 marks) d.

THREE (3) advantages of using Activity-based costing system. 1.

2. 3.

Accurate determination of Product cost where ABC system focuses on the cause-and-effect linkage of costs and activities in the context of producing goods. √ Leads to enhance control over overhead costs. √ Leads to better management system due to accurate product costing. √ Other relevant answers. (3√ x 1 = 3 marks) (Total: 35 marks)

SOLUTION 5 A. a) Two differences between Job and Batch Costing 1. Job costing method is mainly applied when the goods are produced, or services are rendered as per customer’s order. Batch costing is a type of job costing, in which goods are produced in a lot of similar units, called as batches. 2. Job costing is undertaken for the product produced by separate orders. Batch costing is carried out when there is mass production, and the units are homogeneous. 3. In job costing, each product has a unique identity, as each job is distinct from other jobs. In batch costing, products usually lose their identity, as they are produced in the continuum. 4. In job costing, the cost unit is the executed job, whereas, in the case of batch costing, the cost unit is a particular batch. © Hak Cipta Universiti Teknologi MARA

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Or other relevant differences (Any two differences x 2 marks = 4 marks) b) Job cost sheet Job No 120 RM Direct materials: Alumunium Cloth

290√ 170√

Direct labour: Assembly Finishing Prime Cost√ Add: Production Overhead Assembly (3.50 x 20 hours√) Finishing (2.50 x 12 hours√) Production cost Add: Non production overhead Selling and distribution (15%√ x 780) Total cost √ Profit (20/80√ x 897) Selling price

100√ 120√ 680 70 30 780 117 897 224.25√of 1,121.25√of (12√ x ½ = 6 marks)

B. a. i. ii. iii. iv.

Service Business Hotel for Pets (cat) House Cleaning Boat for Langkawi Island Hoping In-home senior care

Cost Unit RM per cat ,per room ,per day√ RM per square foot ,per house, per hour√ RM per passenger, per distance, per hour√ RM per person ,per hour√ (√4 x 1 = 4 marks)

b. i.

Total fixed costs RM Salaries per month: Teaching staff (900 x 4) Chef Admin staff Rent Depreciation furniture Utilities TOTAL

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3,600√ 700√ 500√ 2,000√ 800√ 600√ 8,200

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Total variable costs Foods and drinks (10x40) Learning materials (15x40) TOTAL ii.

RM 400√ 600√ 1,000

Total costs per children = RM8,200 + RM1,000 = RM9,200/40√ = RM230 per child√ (√ 10x½ = 5 marks) (Total: 19 marks)

END OF SUGGESTED SOLUTION

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