FEEDBACK TUTORIAL LETTER 2 nd SEMESTER 2017 ASSIGNMENT 2 COST AND MANAGEMENT ACCONTING 102 CMA512S 1
COURSE: COST AND MANAGEMENT ACCOUNTING 102 COURSE CODE: CMA512S TUTORIAL LETTER: 01/2017 DATE: 08/2017 Dear Student Thank you for submitting your first assignment on time. It was our pleasure to mark it. If your marks are good, I hope this will motivate you to work even harder. If you are disappointed with your marks, please do not give up now. Remember you still have assignment two to try and make up for this. At the same time we would like to remind you that by doing your assignment on your own, and not copying it from other students or asking someone to do it for you will only be to your benefit in the coming exams. Remember to read thoroughly through the questions before answering. Always try to answer as completely as possible, provide all the facts. Don t simply write down the answer, but show all your calculations. Avoid making unnecessary calculation mistakes and always write down the initial formula for any calculation. Use this opportunity to revise the questions in Assignment 1 with the memorandum in hand. Give attention to the remarks of the marker-tutor in your assignment book. If there is anything that you are still unsure of, do not hesitate to contact a market-tutor. We hope to see you at the vacation school and I am looking forward to your next assignment. Regards, Mr. L. Odada Tel. 061 207 2529 Email: lodada@nust.na 1
QUESTION 1 Overhead item Allocated items: Indirect material Indirect labour Primary apportionment: Salary of Suprinten. Insurance equipm. Social security Power Depreciation equip Rent on buildings Primary totals Secondary apportionm: Maintenance centre Basis of Allocation No. of workers Value of equip. Wages paid Kilowatt hours Value of equip. Floor area ASSIGNMENT 2 Total 8 277 4 167 4 000 925 920 565 2 775 2 850 24 479 Production cost centres Assembling Finish- Cutting ing 800 679 1 000 500 240 160 1 500 600 5 479 1 041 699 1 000 250 200 160 750 900 5 000 3 461 899 1 500 50 400 240 150 900 7 600 Value of equip. - 4 000 2 000 400 Total departmental overheads 24 479 9 479 7 000 8 000 direct labour hours 5 000 1 000 4 000 = Overhead absorption rates per direct labour hour 1.89 7.00 2.00 [21 Marks] Service cost centre Maintenance 2 975 1 890 500 125 80 5 375 450 6 400 (6 400) 2
QUESTION 2 Statement of Cost of Goods Manufactured and Sold for the year ended 31 December 2009 N$ N$ DIRECT MATERIALS USED Opening raw materials inventory 65 000 Add: Purchases of raw materials 20 000 Transport costs on direct material 2 000 Raw materials available for use 87 000 Deduct: Closing raw materials inventory 52 000 Raw materials used in production 35 000 DIRECT LABOUR 73 000 PRIME COST 108 000 MANUFACTURING OVERHEADS APPLIED (24 000 machine hours worked x N$4 per hour) TOTAL MANUFACTURING COSTS Add: Opening work in process inventory Deduct: Closing work in process inventory COST OF GOODS MANUFACTURED 96 000 204 000 25 000 229 000 27 000 202 000 [19 Marks] Cost of Goods Sold Opening finished goods inventory Add: Cost of goods manufactured Goods available for sale Closing finished goods inventory Unadjusted cost of goods sold Deduct: over-applied manufacturing overheads (note 1) COST OF GOODS SOLD 30 000 202 000 232 000 20 000 212 000 1 800 210 200 4.2 Income statement for the year ended 31 December 2010 N$ Sales Deduct: Cost of goods sold Gross income Deduct: Selling and Administrative costs: Telephone 2 000 Water and lights 3 000 Transport costs on sales 1 000 Total Selling and Administrative costs Net income N$ 400 000 210 200 189 800 6 000 183 800 3
Note 1 Actual manufacturing overheads: Telephone N$ 3 000 Water and lights N$ 7 000 Indirect material N$ 9 800 Depreciation on factory equipment N$19 000 Indirect labour N$15 400 Factory rent N$40 000 N$94 200 Applied manufacturing overheads N$96 000 Over applied manufacturing overheads N$ 1 800 = ½ mark Unit cost of goods manufactured = Total cost of goods manufactured Number of units manufactured = N$202 000 1 000 units = N$20.20 QUESTION 3 [15 Marks] 1.1 A C D E 1.2 A B C E 1.3 B C D E 1.4 A B D E 1.5 A B C E 1.6 A B C E 1.7 A B C D 1.8 A C D E 1.9 A B C E 1.10 B C D E 1.11 A C D E 1.12 B C D E 1.13 A B C E 1.14 A B D E 1.15 A C D E 4
Date QUESTION 4 Transaction Receipts Issues Balance Cost Amount Cost Amount Cost N$ N$ Units N$ N$ Units N$ [15 Marks] Amount N$ Units Apr. 1 Balance 200 14.50 2 900 6 Purchases 200 15.50 3 100 200 14.50 2 900 200 15.50 3 100 9 Purchases 400 17.50 7 000 200 14.50 2 900 200 15.50 3 100 400 17.50 7 000 14 Issues 200 14.50 2 900 200 15.50 3 100 100 17.50 1 750 300 17.50 5 250 18 Purchases 800 16.50 13 200 300 17.50 5 250 800 16.50 13 200 27 Issues 300 17.50 5 250 400 16.50 6 600 400 16.50 6 600 5