Topic: Management accounting for cost and control
All questions answers should be in 3 to 4 lines and includes refrence. question no.9 should be 300 words.
QUESTION 1 Purpose of management accounting reports
What is the purpose of management accounting reports? Give three examples.
QUESTION 2 factors that drive management accounting work
Describe the three factors that drive management accounting work.
QUESTION 3 Cost concepts
Which of the following is incorrect?
A Direct materials + direct labour = prime cost
B Direct labour + manufacturing overhead = conversion cost
C Prime cost + conversion cost = cost of goods manufactured
D Cost of goods manufactured = direct labour + direct materials + manufacturing overhead
E Only one of the above is incorrect
Explain your answer.
QUESTION 5 Cost concepts
Should overtime payments be treated as direct labour, or as overhead? Why?
QUESTION 6 Understanding the entries in the Materials Control account.
The Materials Control account balances were $34 000 on 1 June and $28 000 on 30 June. Raw materials purchased during June cost $90 000. Direct materials issued to production during June were $40 000.
Reconstruct the Materials Control T-account and show the general journal entry to record the cost of raw materials issued as indirect materials during June.
QUESTION 7 Understanding the entries in the Accrued Payroll account
Salaries and wages payable to factory employees were $12,000 on 1 March and $34,000 on 31 March. Gross salaries and wages paid during March totalled $32,000. March’s direct labour totalled $19,000.
T-account for Accrued Payroll and general journal entries for recording salaries and wages earned by, and paid to, factory employees during March.
QUESTION 9 Activity Based Costing
Your employer is contemplating changing the existing costing systems used in the business to adopt activity based costing (ABC).
Prepare a business report to critically evaluate arguments for and against ABC. Use the Internet as a resource (about 300 words excluding references). The following resource will help you prepare and format your report: