The Principles of Cost Accounting Assignment Tasks
Task 1 - Find the financial operational result using the variable costing according to given data:
- Fixed manufacturing cost - 25 000 €
- Standard (normal) volume of manufactured products during one year - 16 000 units
- Variable cost - 14 € per unit
- Price - 18 € per unit
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Specification
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I quarter of a year
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II quarter of a year
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III quarter of a year
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IV quarter of a year
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Beginning inventory
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0
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Production (units)
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4 100
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4 000
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3 800
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4 200
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Sale (units)
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4 000
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4 000
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3 600
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4 000
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Ending inventory (closing inventory)
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Specification
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I
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II
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III
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IV
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1)
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Revenue
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2)
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Variable manufacturing costs
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3)
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Beginning inventory
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4)
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Ending inventory
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5)
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Variable cost of goods sold
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6)
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Contribution margin
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7)
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Fixed cost
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8)
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Operating income
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Task 2 & 3 - KET Co. manufactures two types of metal kettles: A and B in two production departments: Machining and Painting. The company's production output and sales quantities and other basic data for current year are below:
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Specification
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Kettle A
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Kettle B
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Annual production and sales (units)
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140 000
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120 000
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Direct material (zl per unit)
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60
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70
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Direct labor hours per unit in Machining Department
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1
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1
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Direct labor hours per unit in Painting Department
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2
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3
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Direct labor hour rate (zl per unit)
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13
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17
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Machine time in Machining Department (hours per unit)
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1
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2
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Budgeted overhead costs in both departments are as follows:
- Machining Department 1 600 000 zl,
- Painting Department 1 200 000 zl.
The following activities and cost drivers have been identified:
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Activity
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Overhead cost (zl)
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Quantity of cost driver
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Budgeted level of cost driver
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Kettle A
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Kettle B
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Machine set-ups
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85 000
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850 set-ups
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500
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350
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Material handling
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650 000
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650 000 kg of material
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200 000
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450 000
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Paint working
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2 000 000
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500 000 labor hours
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250 000
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250 000
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Quality control
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65 000
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325 inspections
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200
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125
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Required: Calculate the total production cost per unit each kettle using:
a) Departmental overhead rate using direct machining hours for Machining Department and direct labor hours for Painting department (task 2 - job order costing)
b) Applied overhead rate under activity-based costing system (task 3 - ABC)
Task 4 - The company produces two types of products: A and B, which difference in a weight: A - 2 kilograms [kg], and B - 5 kg. Products are manufactured by the same raw material, in the same production process.
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Direct materials
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120 000 PLN
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Conversion cost
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145 300 PLN
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Product A
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Product B
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Number of units
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Percentage of manufacturing
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Number of units
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Percentage of manufacturing
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Costs of current period
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300
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-
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220
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-
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Work in process at the beginning of the period
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80
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25%
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120
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60%
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Direct materials are issue at the beginning of the production process.
Required: Find the unit cost of a ready product A and B products as well as the unit cost of work in process.
Task 5 - The company produces the homogeneous product. At the end of current month total costs amounted 140 000€ and were value as follows:
- direct materials 221 000 €
- direct labour 170 000 €
- manufacturing overhead costs 185 000 €.
During the current month, 10 000 units of finished goods were produced and transferred to a storehouse, except 4 000 units which were only partly complete (25% - stage of completion). In previous month entire production was finished.
Required: Establish the unit cost of completed and partly completed products if:
1. Direct materials were issue successfully during the production process.
2. Direct materials were the issue at the beginning of production process.
Attachment:- Assignment File.rar