Assignment Cover Sheet Qualification Module Number and Title

Assignment Cover Sheet
Qualification Module Number and Title

HND in Business Management BHNC4204: Accounting & Costing for
Business
Student Name& No. Assessor
BM 84/ Anuruddha Yapa
Hand out date Submission Date
11/02/2020 11/03/2020
Assessment type Duration/Length of Weighting of Assessment
Assignment Assessment Type 100%
1 month / 3000 words
Learner declaration
I, ………………………………………….certify that the work submitted for this assignment is

my own and research sources are fully acknowledged.
Marks Awarded
First assessor
IV marks
Agreed grade
Signature of the assessor Date
FEEDBACK FORM
INTERNATIONAL COLLEGE OF BUSINESS & TECHNOLOGY
1
Module: BHNC 4204: Accounting & Costing for Business
Student:
Assessor: Mr. Anuruddha Yapa
Assignment: Assignment
Strong features of your work:
Areas for improvement:
Marks Awarded:
Learning outcomes covered
2
1. Understand the concepts of financial accounting
2. Understand Main Financial Accounts and the decisions
3. Understand and classify the different cost types in a business
4. Understand and apply management accounting techniques to determine managerial decisions
Assignment Brief
Question 01
I. Classify following items as current assets, fixed assets, intangible assets, long-term
liabilities, current liabilities, revenue and expenses.
 Electricity  Creditors
 Interest received  Bank overdraft
 Debtors  Purchases
 Wages and salaries  Goodwill
 Land and building  Sales
 Bad debt  Accrued salary expense
 Prepaid electricity expense  Bank loan (payable for within 5 years)
 Inventory  Discount allowed
 Mortgage loan  Patent
 Motor vehicle  Depreciation for motor vehicle
(1/2 marks*20 =10 marks)
II. Define the following concepts.
i. Accounting period
ii. Monetary unit
iii. Consistency
iv. Business entity
v. Historical cost
(1 marks*5 = 05 marks)
(15 Marks)
Question 02
3
Derny has been in a business since 1 st of January 2016. The following is a list of her
transactions for month of January 2016.
Jan 01 - Started the business by contributing Rs.200000.

Jan 04 - Deposited Rs.150000 in the bank.
Jan 08 – Bought following assets by cheques.
Buildings Rs.60000
Vehicle Rs.55000
Jan 10 – Purchases on cash Rs.43000.
Jan 13 - Sales on cash Rs.60000
Jan 14 – Deposited Rs.50000 in the bank.
Jan 18 – Purchases on credit.
Anton Rs.40000
Bernard Rs.30000
Jan 21 – Sales on credit.
Fernando Rs.39000
Romesh Rs.17000
Jan 22 – Paid following expenses in cash.
Stationary Rs.670
Carriage Inwards Rs.3000
Jan 25 – Received cheques from following debtors and deposited into bank for collection
immediately.
Fernando Rs.17000
Romesh Rs.8000
Jan 27 – Issued cheques to following creditors.
Anton Rs.13000
Bernard Rs.10000
Jan 30 – Paid following expenses by cheques.
Advertising Rs.8000
Salary Rs.14000
I. Record above transactions in relevant subsidiary books. (10 marks)

II. Prepare the general ledger. (10 marks)
(20 Marks)
Question 03
4
A manufacturing company of small assemblies to order and present following budgeted
overheads for the next year, based on normal activity level
Departmen Budgeted overheads Overhead absorption base

t (€)
Blanking 20000 1500 labor hours
Machining 60000 2500 machine hours
Welding 15000 1800 labor hours
Assembly 10000 1000 labor hours
Selling and administrative overheads are 25% of factory cost

An order for 250 assemblies type XZ, made as batch 300, incurred the following costs:
Materials: € 3500,
Labor: 150hrs blanking shop at €5.00/hr
430hrs machining shop at €7.50/hr
190hrs welding shop at €5.75/hr
170hrs assembly shop at €4.80/hr
€525 was paid for the hire testing weld equipment for XZ. The time booking in the welding
shop was 250 labor hours
Calculate the total cost of the batch, the unit cost and the profit per assembly if the selling
price was €275/assembly (10 marks)
Explain difference between primary and overhead expenses with valid example. (5 marks)
Question 04
5
Following data relate to the budget and actual result of a “Cosmo” firm that makes and sell a
single product and that employs standard marginal costing
Budget Actual
Production 8,000units Production 8,500units
Sales 8,000units Sales 8,500units
$ $
Sales 120,000 Sales 127,500
(Less)
Standard Marginal Cost Actual Marginal Cost
-Materials 8,000 -Materials 8,600
-Labor 32,000 -Labor 40,000
-Var. Overhead 48,000 88,000 -Var. Overhead 56,000 104,600
=Contribution 32,000 =Contribution 22,900
(Less)
Fixed Costs 12,000 Fixed Costs 12,900
Budgeted Profit 20,000 Actual Profit 10,000
The standard cost card for the product is as follows

$
Material 5Kgs at 20cnt/Kg 1.00
Labor 4hrs at $1.00/hour 4.00
Var. Overhead 4hrs at $1.5/hour 6.00
=Standard Marginal Cost 11.00
Standard contribution 4.00
Standard Selling price 15.00
During the period material usage was 40,000kgs and 26,000 labor hours were needed to
finish the product
Calculate
6
1. Operating Profit Variance (2 marks)
2. Direct Material Variance, Direct Labor Variance, Variable Overhead Variance, Fixed
Overhead Variance (5 x 2marks = 10 marks)
3. Prepare summery of cost variance (1 marks)
4. Calculate sales variance and overall variance by using cost and sales variance
(2 marks)
5. Prepare a statement to show the change from budgeted to actual Profit by using
variances (2 marks)
6. Based on the answers you receive from the calculations of above organization explain
how this organization can improve their performance for next year (8 marks)
(25 marks)
Question 05
Star limited manufactures one product. The budget sales for period 6 are for 10,000 units at a
selling price of $100 per unit. Other details are follows
Two components used in manufacture of each unit
Component Numbers Unit cost of each component ($)
XY 5 1
WZ 3 0.50
Stocks at the beginning of the period expected to be follows:

4000 units of finished goods at a unit cost of $52.50
Component XY: 16000 units at a unit cost of $ 1
Component WZ: 9600 units at a unit cost of $ 0.50
Two grades of employees used in the manufacture of each unit:

Employee Hours per Unit Labor rate per hour ($)
Production 4 5
Finishing 2 7
Factory overhead is absorbed into unit costs based on direct labor hours
The budgeted factory overhead for the period estimated to be $ 96,000
7
The administration, selling and distribution overhead for the period has been budgeted at $
275,000
The company plans to reduce 50% in the quantity of finished stock at the end of the period 6
and increase of 25% of the quantity of each component depending on available opening
stocks.
Prepare the following budgets for period 6
1. Sales budget (2 marks)

2. Production Quantity budget (2 marks)
3. Material usage budget (2 marks)
4. Material purchase budget (2 marks)
5. Direct Labor budget (2 marks)
6. Value of closing raw material budget (2 marks)
7. Closing finished stock budget (2 marks)
8. Cost of goods sold budget (2 marks)
9. Budgeted Profit and loss account (4 marks) (20 marks)
8
Report Format (05 marks)
 Type your assignment clearly

o Font type: Times New Roman
o Font size
 Headings : 14 pt, Bold, Underlined
 Sub-headings : 12 pt, Bold, Underlined
 Body : 12 pt, normal
 Align : Justify
 Line spacing : 1.5
 Margins : 1” form each side
 Numbering : at the bottom right hand corner
 Header
 Left side- subject name
 Right side- individual/group assignment
 Footer
 Left side- batch number
 Right side-page number
 All the Figures, Tables, Diagrams etc. should be numbered
 Label sketches properly and neatly.
 Write on only one side of the paper.
 Utilize a table of contents and section headings where applicable.
 Use size A4 paper.
 Referencing should be done strictly using Harvard system
Line up of the report
1. Acknowledgement
2. Executive summary
3. Table of contents
4. List of illustrations/diagrams (if applicable)
5. Introduction
6. Answers for the question
7. Conclusion and Recommendation
8. References
9. Appendices

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Assignment Cover Sheet

Qualification Module Number and Title

I, ………………………………………….certify that the work submitted for this assignment is

Strong features of your work:

Areas for improvement:

Learning outcomes covered

(1/2 marks*20 =10 marks)

II. Define the following concepts.

Jan 01 - Started the business by contributing Rs.200000.

I. Record above transactions in relevant subsidiary books. (10 marks)

Departmen Budgeted overheads Overhead absorption base

Selling and administrative overheads are 25% of factory cost

The standard cost card for the product is as follows

Stocks at the beginning of the period expected to be follows:

Two grades of employees used in the manufacture of each unit:

Prepare the following budgets for period 6

1. Sales budget (2 marks)

 Type your assignment clearly

Line up of the report

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