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QUESTION 1 Management accounting
Describe the three factors that drive management accounting work. Give examples (about 150 words).
QUESTION 2 Control
what is meant by the control function of management accounting? Give examples (about 150 words).
QUESTION 3 Cost concepts
which of the following statement is false?
A. Cost accumulation to determine the cost of goods sold is an example of the control function of management accounting work.
B. Cost represents the value of resources consumed to achieve a specific objective.
C. A cost object is an activity for which a cost is required.
D. A cost driver is an activity that causes costs to change.
E. A variable cost varies proportionately with changes in the cost driver.
Explain your answer.
QUESTION 4 Manufacturing statement and income statement
Spreadsheet. See the Spreadsheet Advice PDF in Interact2 Resources and the examples in your textbook.
See the requirements within the spreadsheet template below.
Check the assignment requirements below paying particular attention to the spreadsheet requirements. Ensure you have separate data and report areas showing only formulas. Use IF functions to allow for the possibility of either a net income or a net loss. Show row and column headings and paste both a normal view and a formula view.
The following information has been obtained from the books of Ponting Manufacturing Co. Ltd at 30 September, 20X7:
Finished Goods $300 000
Raw Materials 500 000
Work in Process: Material 80 000 Labour 30 000 OH Expense 20 000
Finished Goods 120 000
Raw Materials 70 000
Work in Process: Material 30 000 Labour 20 000 OH Expense 10 000
Summary of transactions for year
Raw material purchases 2 000 000
Inward Charges on raw materials 80 000
Direct labour 660 000
Manufacturing expense 200 000
Sales of finished goods 6 000 000
Advertising 45 000
Audit Fee 3 000
Discounts to debtors 10 000
Discounts from creditors 8 000
Cartage Outwards 20 000
Insurance 15 000
Light and power (Office) 28 000
General Expenses 25 000
Rates 30 000
Salaries (Office) 450 000
Salaries (Factory) 550 000
Travellers’ Commission 150 000
Adjustments are to be made in respect of the following:
(a) Accrued expenses: Salaries (Office) $2000, Salaries (Factory) $3000
(b) Insurance paid in advance, $500
(c) Estimated taxation liability for current year, $340 000
(d) Depreciation of factory plant, $25 000
(e) Insurance and rates are to be apportioned three-quarters to the factory and one-quarter to the office.
(a) Manufacturing statement for the year.
(b) Income statement for the year.
QUESTION 5 Cost concepts
“If a perpetual inventory system is used for recording movements of raw materials there is no need to conduct a physical stocktake.”
Do you agree? Why? (About 150 words).
QUESTION 6 Understanding the entries in the Materials Control account with GST
The Materials Control account balances were $20 000 on 1 August and $10 000 on 31 August. Raw materials issued to production during August cost $60 000. (All direct materials).
Show the Materials Control, Accounts Payable and GST Clearing accounts in the ledger for August and a general journal entry to record the cost of raw materials purchased (all on credit) during August, given that a 10% GST is paid on purchases.
QUESTION 7 Understanding the entries in the Accrued Payroll account
Salaries and wages payable to factory employees were $10 000 on 1 March and $4000 on 31 March. Gross salaries and wages paid during March totalled $40,000. March’s direct labour totalled $18 000.
T-account for Accrued Payroll and general journal entries for recording salaries and wages earned by, and paid to, factory employees during March.
QUESTION 8 Payroll entries
The Ajax Company has a gross payroll of $20,000 per day. Withholdings for PAYG taxes are $6,000 per day. There are no other deductions from employees’ earnings. The firm works five days per week, Monday to Friday inclusive. The payroll period covers Thursday to Wednesday inclusive and the payroll for the week is paid on the following Friday.
Gross payroll consists of $12 000 direct labour, $3000 indirect factory labour, $3000 selling expenses and $2000 general and administrative expenses each day. The following calendar should be used to answer the questions:
(a) What is the total amount to be credited to Accrued Payroll in respect of July earnings?
(b) If balance day adjustments are performed at the end of each month, what would be the balance in Accrued Payroll account at the close of business on July 31?
(c) Suppose that a single journal entry is made on the last day of each month to record the distribution of total labour costs for the month, but that entries are made each Friday to record payment of wages and withholdings. Also, PAYG taxes withheld are remitted to the Taxation Department at the end of each month.
(i) Show the weekly journal entry.
(ii) Construct the necessary ledger accounts to show all entries in respect of labour costs during the month of July.
QUESTION 9 Activity Based Costing
your employer is contemplating changing the existing traditional costing systems used in the business to adopt activity based costing (ABC). See your text page 81.
Prepare a business report outlining the traditional costing system and evaluate arguments for and against ABC. Use the Internet as a resource and academic journal articles (about 400 words excluding references). The following CSU resource will help you prepare and format your report:eportfolio.csu.edu.au/pebblepad/viewasset.aspx
Or see this resource. unilearning.uow.edu.au/report/4b.html
QUESTION 10 Service department cost allocation
Review the examples in your textbook.
Direct, step and reciprocal methods of overhead allocation: moderately difficult
A company has two production departments (Component Manufacture and Assembly) and two service departments (Staff Cafeteria and Materials Handling). The budgeted costs of these departments are:
Component Assembly Cafeteria Materials Handling
Manufacture $ $ $ $
Direct (to centre)
Material & labour 200 000 150 000 5 000 15 000
Indirect costs 120 000 110 000 3 000 5 000
The services of the Cafeteria are allocated according to the number of employees in the other departments: Materials Handling has 20 employees, Component Manufacture 50 employees and Assembly 40 employees.
The services of the Materials Handling department are allocated according to the number of budgeted requisitions per period. These are estimated as 30 for the Cafeteria, 40 for Component Manufacture and 30 for Assembly.
Allocate service department costs to the production departments using
(a) the direct method
(b) the step method
(c) the reciprocal services method.
You can choose if you wish to answer with a spreadsheet. Or not.
|Criteria for expected learning outcomes to be achieved include critical evaluation of costing systems, demonstrating understanding and application of cost flows in management accounting, functions of cost flows in manufacturing, terminology, manufacturing statements, computer modelling, product costing, materials acquisition systems, labour payment systems, accounting for overhead, activity based costing, (ABC) and the allocation of overhead including service department costs.||Be the result of your original work, complete without any omissions and correct.|
Evaluate all the issues raised in questions.
Provide examples where appropriate
Accurate answers complying with all spreadsheet requirements relevant to each scenario.
|Be the result of your original work, be mostly complete without any omissions, and be mostly correct.|
Evaluate most of the issues raised in questions
Provide some examples where appropriate
Comply with the majority of spreadsheet requirements relevant to each scenario.
|Be the result of your original work, be mostly complete with few omissions, and be partially correct.|
Evaluation of some of the issues raised in questions.
Provide examples where appropriate.
Comply with some of the spreadsheet requirements relevant to each scenario.
|Be the result of your original work, be mostly complete with some omissions, and be partially correct.|
Evaluate some of the issues raised in questions
Provides 1-2 examples where appropriate
Comply with some spreadsheet requirements.
|Academic writing skills. The discussion answers and business reports meet academic standards of syntax, vocabulary, spelling and punctuation and reflects an awareness of audience needs.||Accurate use of syntax, spelling and punctuation; correctly refers to a variety of sources to support arguments, including the prescribed texts and a range of additional readings; reference list of the range of resources used, correctly formatted using APA style.||Accurate use of syntax, spelling and punctuation; succinct and effective use of vocabulary; correctly refers to a range of sources to support arguments, including the prescribed text and a variety of further readings;|
reference lists a range of relevant resources used, correctly formatted using APA style.
|Accurate use of syntax, vocabulary,|
spelling and punctuation; correctly refers to more than the minimum requirement of sources to support arguments, including
prescribed texts and recommended readings;
reference list formatted in APA style, with few or no errors.
|Mostly accurate syntax, spelling and punctuation; correctly refers to minimum number of sources to support arguments, including prescribed texts; reference list used, formatted in APA style, with few errors.|