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Department of Accounting Individual Assignment - Cost Accounting I

This document contains 8 individual assignments and 6 group assignments on cost accounting topics. The individual assignments include questions about cost accounting definitions and applications, as well as preparation of schedules for cost of goods manufactured, cost of goods sold, and income statements using sample company data. The group assignments include questions differentiating between costing methods, defining cost accounting terms, and preparing projections using absorption and direct costing methods. Students are instructed to complete the individual assignments individually and the group assignments in groups of 4-5 students by the given submission date.

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229 views3 pages

Department of Accounting Individual Assignment - Cost Accounting I

This document contains 8 individual assignments and 6 group assignments on cost accounting topics. The individual assignments include questions about cost accounting definitions and applications, as well as preparation of schedules for cost of goods manufactured, cost of goods sold, and income statements using sample company data. The group assignments include questions differentiating between costing methods, defining cost accounting terms, and preparing projections using absorption and direct costing methods. Students are instructed to complete the individual assignments individually and the group assignments in groups of 4-5 students by the given submission date.

Uploaded by

solomonaau
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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Department of Accounting

Individual Assignment - Cost Accounting I


1. State the meaning, scope, objectives, importance and limitation of cost accounting in a
production unit.
2. Differentiate between cost accounting management accounting and financial accounting.
3. What are the differences between controllable costs and uncontrollable costs?
4. What are the differences between sunk costs, historical costs and budget costs?
5. What makes the income statement of manufacturing company differs from the income
statement of a merchandising company?
6. Distinguish the differences between cost, expense and expenditure.
7. The following data was taken from the general ledger and other records of Marathon
Manufacturing Co. at July 31, 2013 the end of the first month of operations in the current fiscal
year:
Sales ………………………………… $50,000
Materials inventory (July 1) ……….. 15,000
Work in process inventory (July 1) … 20,000
Finished goods inventory (July 1) …. 28,000
Materials purchased ………………… 21,000
Direct labor cost ……………………. 12,500
Factory overhead (including $5,000
of indirect materials used and $2,500
of indirect labor costs) ……………… 11,500
Selling and administrative expense … 8,000
Inventories at July 31:
Materials ……………………………. 16,000
Work in process ……………………. 18,000
Finished goods ……………………… 30,000
Required:
a. Prepare a schedule of cost of goods manufactured.
b. Determine the cost of goods sold for the month.
c. Prepare income statement.
8. ABC Company has two support departments (Power and Maintenance) and two producing
departments (Assembly and Finishing). The causal factor for the power costs is kilowatt
hours; the causal factor for the maintenance costs is repair hours. Assume the following
information:
Power Maintenance Assembly Finishing
Direct costs....................... $100,000 $150,000 $75,000 $50,000
Kilowatt hours.................. - 10,000 90,000 100,000
Repair hours..................... 500 - 2,500 2,000
Required: assign support department costs to the producing departments using:
a. The direct allocation method.
b. The sequential allocation method.
c. The reciprocal allocation method.
Group Assignment - Cost Accounting I
1. Differentiate between absorption costing and variable costing.
2. Briefly explain the difference between costing and cost accounting.
3. Explain term cost centre and cost unit.
4. The following data was taken from the general ledger and other records of Metal
Manufacturing Co. at January31, 2013, the end of the first month of operations in the current
fiscal year:
Sales …………………………… $650,000
Inventories at January 31:
Materials inventory …………. 20,000
Work in process inventory ….. 32,000
Finished goods inventory …… 54,000
Inventories at January 1:
Materials ……………………. 25,000
Work in process …………….. 29,000
Finished goods ……………… 48,000
Materials purchased …………… 154,000
Labor Costs:
Assembly workers’ wages ….. 185,000
Supervisors’ salaries ………... 30,000
Sales personnel salaries …….. 52,000
Depreciation:
Factory building …………….. 73,000
Sales office ………………….. 28,000
Indirect materials used ……… 3,000
Factory utilities ……………... 67,000
Required:
a. Prepare a schedule of cost of goods manufactured.
b. Determine the cost of goods sold for the month.
c. Prepare income statement.

5. Compute cost of goods manufactured, cost of goods sold and prepare income statement for XYZ
Company ending December 31, 1999 from the following given information.
Sand Paper ………………………………….. Br 2,000
Direct Material Inventory January 1………... 40,000
Lubricants and Coolants…………………….. 5,000
Purchase of direct materials………………… 460,000
Materials handling cost……………………... 70,000
Direct manufacturing labor ………………… 30,000
Indirect manufacturing labor………………... 40,000
Depreciation on cost of plant and equipment… 36,000
Property tax on plant and equipment ………… 4,000
Plant leasing cost……………………………... 54,000
Work in process inventory January 1………… 10,000
Fire insurance…………………………………. 3000
Work in process inventory December 31…….. 14,000
Revenue ……………………………………… 1,360,000
Finished Goods Inventory January 1…………. 100,000
Finished Goods Inventory December 31…… 150,000
Marketing promotion ………………………… 60,000
Marketing salaries …………………………… 100,000
Distribution cost……………………………… 70,000
Customer service cost ………………………... 100,000
Direct material inventory December 31………. 50,000
6. Assume that the business operation plan for Abdi Biyya Company for five periods. Data
regarding budgeted selling price, budgeted variable production cost per unit and fixed
overhead, variable selling cost, fixed selling and administrative cost per period are given
below, together with budgeted volumes of production and sales over the next five periods of
productions.
Selling price per unit Br 20
Variable production cost per unit 9
Fixed production overhead per period 500
Variable selling cost/unit 2
Fixed selling and administrative 250
2014 2015 2016 2017 2018
Units produced 230 270 260 240 250
Units sold 200 210 260 280 300
Units of Ending inventory 30 90 90 90 Nil
Required: Prepare Projected Income Statement under Absorption & Direct Costing Methods

Dear Students!
These are your assignments on chapter 1-3 which should be done individually and in group of
4-5 students. You can work with your friends but copying from each other is strictly forbidden
as it gives zero value. The Submission date for the assignments will be on Meskerem 10,
2006 E.C.  You have to submit your assignments before or on submission date only. You
are liable for late submission!

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