CT MAF251 MAY2021 Q - COMMON TEST EXAM PAPER PDF

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UNIVERSITI TEKNOLOGI MARACOMMON TEST 1COURSE : COST AND MANAGEMENT ACCOUNTING 2COURSE CODE : MAFEXAMINATION : MAY 2021TIME : 1 HOUR 30 MINUTESINSTRUCTIONS TO CANDIDATES This question paper consists of three (3) questions. Answer ALL questions in English. Please save your answer scripts in ONE (1) pd...

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AC/MAY 2021/MAF251

UNIVERSITI TEKNOLOGI MARA COMMON TEST 1

COURSE

:

COST AND MANAGEMENT ACCOUNTING 2

COURSE CODE

:

MAF251

EXAMINATION

:

MAY 2021

TIME

:

1 HOUR 30 MINUTES

INSTRUCTIONS TO CANDIDATES 1.

This question paper consists of three (3) questions.

2.

Answer ALL questions in English. Please save your answer scripts in ONE (1) pdf file and rename to: (NAME_STUDENT ID_CLASS)

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO This examination paper consists of 5 printed pages

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AC/MAY 2021/MAF251

QUESTION 1 a. Identify the correct term for the following definition on characteristics of good information. NO 1

DEFINITION The use of technical language or jargon must be limited. Accountants must always be careful about the way in which they present financial information to non financial managers.

2

The cost of obtaining the information must not exceed its value. The information is valuable because it assists decision making.

3

Information contained within a report should be appropriate to its purpose.

4

Information should be trusted and believable so that the users can have confidence and made an informed decision.

TERM

(4 marks)

b. CIMA Terminology defines management accounting as the application in the principles of accounting and financial management to create, protect, preserve and increase the value for the stakeholders Based on the above statement, explain THREE (3) roles of management accountants. (3 marks)

c. Differentiate any THREE (3) characteristics between financial accounting and management accounting. (3 marks) (Total: 10 marks)

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AC/MAY 2021/MAF251

QUESTION 2 Excellent Sdn Bhd manufactures a single product called Magenta. The budgeted costs of the company for the first half year of 2021 based on budgeted productions and sales of 15,000 units of Magenta are as follow:

Direct material Direct labour Manufacturing overhead

RM 135,000 67,500 121,500

The standard price for the direct material is RM4.50 per litre whereas the standard rate for the direct labour is RM1.50 per hour. The overhead costs are charged to production based on direct labour hours. Standard fixed overhead absorption rate is RM5.40 per unit. The standard selling price is RM33 per unit. The actual data for the period is as follows:

Sales Less: Variable costs Direct materials Direct labour Variable overhead Contribution margin Less: Fixed costs Fixed overhead Net profit

RM 507,500 (128,000) (79,200) (55,000) 245,300 (90,000) 155,300

The total actual direct material quantity is 32,000 litres whereas the total actual direct labour hours is 44,000 hours. The actual sales volume is 14,500 units. Required: a.

Prepare a standard cost card for one unit of Magenta. (4 marks)

b.

Calculate the following variances for the first half year of 2021: i. ii. iii. iv. v.

Direct material price and usage Direct labour rate and efficiency Variable production overhead expenditure and efficiency Fixed production overhead expenditure and volume Sales margin price and volume (14 marks)

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AC/MAY 2021/MAF251

c.

Construct a statement reconciling budgeted net profit and actual profit for the first half year of 2021. (2 marks)

d.

Advise the management of Excellent Sdn Bhd on the action to be taken due to the result of adverse material usage variance. (3 marks) (Total: 23 marks)

QUESTION 3 One Choice Sdn Bhd produces small components CPS, CPM and CPL to be incorporated into sets of car parts which are produced by local manufacturer. Currently the company supplies the small components to Carrie Bhd, one of the biggest car parts manufacturers. The production of the components by One Choice Sdn Bhd will depend on the order from Carrie Bhd. Each set of car part produced by Carrie Bhd needs four (4) units of component CPS, six (6) units of component CPM and three (3) units of component CPL. Normally Carrie Bhd receives a stable order of 2,500 sets of car parts per month. Information related to the small components produced by One Choice Sdn Bhd is given below:

Selling price per unit Standard costs per unit: Direct material Direct labour Total overhead (variable overhead is absorbed at RM2.00 per unit) Resources per unit: Direct labour hour Machine hour

CPS RM 25.00

CPM RM 17.00

CPL RM 15.00

9.00 6.00 3.00

6.00 4.00 4.50

5.00 3.00 5.00

1.5 hours 3 hours

2 hours 2 hours

0.5 hour 1 hour

For the coming month, it is forecasted that the production of the components will increase due to the increase in car demand. People take the opportunity to buy car because of the tax exemption period announced by the government. The company has been informed by Carrie Bhd that the demand of the sets of car parts will increase by 10%. Since the demand is urgent, Carrie Bhd will rely on several other suppliers and is willing to accept any combination of component supplied by One Choice Sdn Bhd.

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AC/MAY 2021/MAF251

Though sales could be increased, the production of the components cannot be expanded to meet the increase in car parts demand due to limited machine hour. Currently, the machine hours available are just enough to be utilized by the current production and sales. The engineering department suggesting upgrading the machine capacity and this will increase the current machine hours available by 500 hours. There is no shortage of labour hours. The current total fixed cost of the company is expected to increase by 5% due to machine upgrading. Required: a.

Calculate the shortage of machine hours for the coming month. (3 marks)

b.

c.

i.

Predict the most optimal component mix to be produced by One Choice Sdn Bhd for the coming month. (10 marks)

ii.

Based on your prediction in part (b) (i) above, construct a profit statement to show the net profit of One Choice Sdn Bhd. (2 marks)

Identify TWO (2) examples of scarce resources that are known as limiting factors. (2 marks) (Total: 17 marks)

END OF QUESTION PAPER

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