MAF551 - JUNE 2016 - PAST YEAR QUESTION - S PDF

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PYQ JUNE 2016 (prepared by : Nur Anis Hidayati Mustapha)Question 3INTAN BAIDURI SDN BHDa) Relevant Production CostComponent IB 1 IB 2 IB 3 IB 4 Direct Material RM36,000/8,= RM4.RM88,000/16,= RM5.RM128,000/32,0= RM4.RM120,000/24,0= RM5.Direct Labour RM64,000/8,= RMRM96,000/16,= RMRM160,000/32,0= RMRM...

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PYQ JUNE 2016 (prepared by : Nur Anis Hidayati Mustapha) Question 3

INTAN BAIDURI SDN BHD a) Relevant Production Cost Component Direct Material

IB 1 RM36,000/8,000

IB 2 RM88,000/16,000

IB 3 RM128,000/32,00

IB 4 RM120,000/24,00

= RM4.50

= RM5.50

0

0

RM64,000/8,000

RM96,000/16,000

= RM4.00 RM160,000/32,00

= RM5.00 RM96,000/24,000

= RM8

= RM6

0

= RM4

Overheads

RM8/RM10xRM5

RM6/RM10xRM5

= RM5 RM5/RM10xRM5

RM4/RM10xRM5

TOTAL COST

= RM4 RM16.50

= RM3 RM14.50

= RM2.50 RM11.50

= RM2 RM11

Direct Labour

Working Overhead based on DL hour: Total Labour Hour = (RM8/RM10 x 8,000units) + (RM6/RM10 x 16,0000units) + (RM5/RM10 x 32,000units) + (RM4/RM10 x 24,000units) = 6,400 + 9,600 + 16,000 + 9600 = 41,600 hours Variables overhead = (RM582,400 – RM374,400)/ 41,600hours = RM5 per hour

b) Manufacture Cost of Making Variable cost/unit (x) units COST OF MAKING

IB 1 RM16.50 8,000 RM132,000

IB 2 RM14.50 16,000 RM232,000

IB 3 RM11.50 32,000 RM368,000

IB 4 RM11 24,000 RM264,000

IB 1 17 3

IB 2 15 3

IB 3 10 3

IB 4 12 3

RM20 8,000 RM160,000 (40,000) RM120,000 BUY

RM18 16,000 RM288,000 (25,000) RM263,000 MAKE

RM13 32,000 RM416,000 (36,000) RM380,000 MAKE

RM15 24,000 RM360,000 (60,000) RM300,000 MAKE

Purchase Cost of Buying Price(RM) (+) checking quality (RM) (x) units (-) fixed cost COST OF BUYING DECISION

c) Three qualitative factors that management consider before making a decision to make or buy: - quality of purchase component - realibility of supply by the supplier - time to deliver component by supplier

d) Proposal made Japanese International Co. worth or not Cost of Making Variable cost/unit (x) units

IB 1 RM16.50 25,000 units x 2 = 50,000 units

IB 2 RM14.50 25,000 units x 2 = 50,000 units

IB 3 RM11.50 25,000 units

IB 4 RM11 25,000 units

COST OF MAKING

RM825,000

RM725,000

RM287,500

RM275,000

Total Cost: = RM825,000 + RM725,000 + RM287,500 + RM275,000 = RM 2,112,500 *Yes it is worth it to accept the proposal from the International co. since it will result in additional profit of RM187,500 (RM2,300,000 – RM2,112,500)....