Professional Documents
Culture Documents
MA1-update-25 5 2022
MA1-update-25 5 2022
B/ Classifications of costs
b1/ ....based on relationship between costs and FSs
* Base: costs <==> FSs
* Content
* Beg inventory + inventory increases = inventory decreas
=> RM: Beg RM + Puchases RM = RM issued for produc
=> WIP: Beg WIP + Manufacturing costs = Costs of good
=> Finished products: Beg finished goods + COGM = CO
Q7
Marketing, distribution, and customer-service costs
Merchandise inventory, January 1, 2011
Utilities
General and administrative costs
Merchandise inventory, December 31, 2011
Purchases
Miscellaneous costs
Transportation-in (freight in)
Purchase returns and allowances
Purchase discounts
Revenues
b) income statement
Marvin Department Store
Income statement
For the year ended 31 Dec 2011
Revenues
Less: COS (a2)
Gross profit
Less:
Marketing, distribution, and customer-service costs
General and administrative costs
Utilities
Miscellaneous costs
Net income
Q10
Piedmont Corporation
Direct materials inventory
Work-in-process inventory
Finished goods inventory
Purchases of direct materials
Direct manufacturing labor
Indirect manufacturing labor
Indirect materials
Plant insurance
Depreciation—plant, building, and equipment
Plant utilities
Repairs and maintenance—plant
Equipment leasing costs
Marketing, distribution, and customer-service costs
General and administrative costs
1. COGM
Beg WIP
Manufacturing costs in 2011
+ DM
Beg DM at 1/1/2011
Add: purchased DM
2. Income statement
Piedmont Corporation
Income statement
For the year ended 31/12/2011
Revenue
Less: COS
+ Beg finished goods
+ COGM (1)
+ End finished goods
Gross profit
Less:
Marketing, distribution, and customer-service costs
General and administrative costs
Net income
Direct costs
(directly assign to cost object)
Indirect costs
(indirectly allocation)
Fixed costs
+ Total fixed costs: unchanged when level of acitvities ch
+ Fixed cost per unit of activity
Variable costs
+ Total costs
mixed costs
Q9
Direct materials inventory 10/1/2011
Direct materials purchased
Direct materials used
Total manufacturing overhead costs
Variable manufacturing overhead costs
Total manufacturing costs incurred during October 2011
Work-in-process inventory 10/1/2011
Cost of goods manufactured
Finished goods inventory 10/1/2011
Cost of goods sold
1) Direct material at 31/10/2011
Beg DM + DM purchased = DM used + End DM
=> End DM = (Beg + Purchased - Used)
Beg DM
DM purchased
DM used
End DM
3) DL costs
Total MC
Less:
DM
MO
DL
Ex 2
Ex 3
F. Electricity costs for NUMMI plant (single bill covers entire plant)
Ex 4
a) minutes/month
Plan A ($/month)
Plan B ($/month)
Plan C ($/month)
b) b1) 100 minutes
Plan A:
Plan B:
Plan C:
Ex 5
1/ Variable cost per ton
Subcontractor
Government tax
Ex 6
variable cost/student (9 - 5)
FC
+ paid to Band
+ paid to caterer
$
resources given up, to achieve a particular purpose
House 300,000 construction materials: brick, s
60,000 labor forces: salaries, wages
10,000 dep expense of equipment
3,000 others
373,000
Costs
Direct materials
Selling expenses
Non-manufacturing costs
(period cost) Administrative expenses
dep expense
factory building MO
office building the same Admin expense
showroom selling
$
280,000
(145,000)
135,000
ce costs (37,000)
(43,000)
(17,000)
(4,000)
34,000
65,000
128,000
193,000
(34,000) 159,000
106,000
48,000
14,000
2,000
21,000
12,000
8,000
32,000 137,000
0 + 106,000 + 137,000) 402,000
485,000
(72,000)
413,000
$'000
600,000
123,000
413,000
(102,000) 434,000
166,000
ce costs (62,000)
(34,000)
70,000
vels of activtiess
Level activit 1st month ( 2nd (80)
Rent (20m2) Number of 10m 10m
Cost of mobiphone (2customers 100m 180m
$
H
O
200
home phone fixed cost
variable cost
105
365
470
(385)
85
450
(265)
185
DM + DL + MO = total MC
=> DL = Total MC - DM - MO
1,610
(385)
(450)
775
d WIP
230
1,610
1,840
?
1,660
130
1,660
1,790
??
1,770
D or I V or F
D F
I F
D V
D F
I F
I V
I F
D V
D or I V or F
D V
I F
D F
D F
D V
I V
D V
I F
$ b2)
10 24
15 15
22 22
$/ton
80
50
130
$
150,000
300,000
450,000
450,000
300,000
150,000
1,000
600 VC
1,600
erials: brick, sand, steel....
ries, wages
equipment
..... n (200)
400m
level of activities
x + FC (1)
+ FC (2)
- Mmin)
510 600
51 60
36.60 43.80
22 26.50
A
B
minutes/month
VC
FC
number of students
s => COGS (COS)
C
Chapter 2: Accounting for overhead and absorption cost
Q2
a) Direct method
b) Step down method
c)
Q3
Q4
Q5
Q6
Q7
Q8
Q9
a)
b)
Q10
Q11
a)
b)
Q12
a)
b)
c)
Q13
a)
b)
Q14
c)
Q15
Q16
a)
b)
Q17
a)
b)
c/
c1/
c2/
Chapter 2: Accounting for overhead and absorption cost
Reapportioned IS costs
Reciprocal method
methods 1: repeated
Reapportioned maintenance
Reapportioned IS
B/ Absorbed overhead
absorbed overhead = OAR (0verhead rate) * actual activity
OAR = Estimated OH/Estimated volume of cost driver
= 3,100,000/31 = 100,000
Actual activity: 25 students
= 100,000*25 = 2,500,000
Dr Overhead
Cr COS
Costs
Heat and light
Repair cost
Dep expense
Rent
Cateen
Machinery insurance
Total apportined cost
a) Direct method
Algebraic method
x is cost per hour of maintenance dept
y is cost per store requisition
10,000x = 34,840 + 1,000y (1)
5,000y = 18,660 + 1,000x (2)
based on DM (36,000/32,000)
based on DL (36,000/40,000)
...MHs (36,000/10,000)
...DLHs (36,000/18,000)
...units of production (5,000/1,000)
OAR (63,000/9000)
Overhead absorbed (7*9,900)
Actual overhead
Over-absorbed
Dr Overhead
COS
DM (4*3)
DL (2*4)
Overhead (700,000/50,000)
Cost per unit
Salary of supervisor
Remaning overhead
(700,000 - 100,000 = 600,000)
DM (4*3; 4*2)
DL (2*4; 2*1)
Overhead
+ Assembly (3*3; 1/2*3)
+ Finishing (10*1; 10*1/2)
Cost per unit
Y => A, B, C & X
X => A, B, C
Allocated overheads
Apportioned overheads
Total allocated & apportioned cost
Re-apportioned
Y (11,880/56*14; *21; *14; *7)
X (9,920*20%; *45%; *35%)
Total allocated, apportioned, re-apportioned
Estimated OH
Estimated MHs
Estimated DLHs
Estimated OAR
Estimated OAR
Actual activities
Absorbed OH
Absorbed OH
Actual OH
Over-absorbed
Under -absorbed
Dr MO - X
Cr COS
Dr COS
Cr MO - Y
Allocated costs
Apportioned costs
+ Building dep (42,000/12,000*4,560; ....)
+ Management salaries (27,000/54*18; ...)
+ Power (12,600/12,000*6,200;5,800)
+ Other utilities (9,400*35%; *45%; *10%....)
Total allocated & apportioned costs
(TEAM)
Actual > Absorbed => Actual - Absorbed = under absorption
Reason 1: Actual price > Budget price, Volume of resources consumed
Reason 2: Actual activities > Estimated activities used under budget
(TEAM)
Budgeted costs
Budgeted hours (MHs, DLHs)
Predetermined absorption rate
Actual costs
Actual hours
Absorbed
(23.6*1,235; 8.4*6,395)
Under absorbed
Over absorbed
DM, DL, OH
- enable estimating cost of production just after production completed
- enable to control OH
Items
Maintenance labor cost
Power
Rent & rates
Estimated costs
Estimated MHs
Rates ($/MH)
Job 21
Absorbed of MG1 (15.8*5)
Absorbed of MG2 (19.2*2)
Absorbed of MG3 (24.3*3)
Total absorbed
Service Depts (maitenance; IT; human .....)
Support Depts
Maintenance
6,300,000
(6,300,000)
Support Depts
Maintenance
6,300,000
(6,300,000)
Support Depts
Maintenance
6,300,000
(6,300,000)
-
271,215
(271,215)
-
x=
y=
Support Depts
Maintenance
6,300,000
276,750
$
19,200
9,600
54,000
38,400
9,000
25,000
155,200
Production Departments
A
93,030
Production Departments
A
93,030
19,356
10,367
122,752
Production Departments
A
93,030
11,196
21,429
125,655
x = 3.94
y = 4.52
Production Departments
A
93,030
19,660
13,560
126,250
Dept A
1.13
0.90
3.60
2.00
7
69,300
61,500
7,800
7,800
$
12
8
14
34
Assembly
60,000
240,000
300,000
90,000
10,000
100,000
Desk
12.00
8.00
9.00
10.00
39.00
Total
20,000
5,000
25,000
7,000
18,000
5,000
80,000
21,062
90
234.02
Total
80,000
(a)
(b)
2,970
1,984
52,520
X
161,820
8,700
_____
18.60
X
18.60
8,960
166,656
X
166,656
163,190
3,466
3,466
4,251
P1
107,000
15,960
9,000
6,510
3,290
141,760
P1
141,760
34,395
34,370
210,525
Cost centre X
$28,556
1,210
$23·60 per machine hour
$29,609
1,235 machine hours
29,146
463
ompleted
$
33,600
26,000
39,800
MG1
129,560
8,200
15.80
79.00
38.40
72.90
190.30
man .....)
ging....)
1,260,000 1,890,000
2,712,150
(2,712,150) 2,410,800
- 8,300,800
1,260,000 1,890,000
2,712,150
(2,712,150) 2,169,720
-
54,243 81,365
e hour is x
y
(a)
(b)
328.83
553.50
1,315,320 1,972,980
2,214,000
8,186,980
Case 2
Case 3
Store
Maintenance
Departments Service Departments
B Maintenance
60,670 34,840
3,732 3,732
17,143 (38,572)
81,545 -
Rounded number
Dept B
5.00
$/DLH
COS
7,800
Finishing Total
40,000 100,000
360,000 600,000
400,000 700,000
30,000
10,000
40,000
10
Chair
8.00
2.00
1.50
5.00
16.50
Processing Packing
12,500 6,250
15,000 10,000
- -
36,125 22,813
Processing Packing
36,125 22,813
11,701 9,361
47,826 32,174
Production Cost Centre
B C
38,490 14,671
45,841 28,360
84331 43031
4,455 2,970
4,464 3,472
93,250 49,473
Y
97,110
8,300
11.70
Y
11.70
7,870
92,079
Y
92,079
96,330
4,251
3,466
4,251
P2 Material store
89,000 68,000
19,740 2,520
12,000 3,000
6,090
4,230 940
131,060 74,460
P2 Material store
131,060 74,460
45,860 11,465
51,555 (85,925)
228,475 -
Cost centre Y
$54,264
6,460
$8·40 per labour hour
$52,567
6,395 labour hours
53,718
1,151
MG2 MG3
107,520 119,070
5,600 4,900
19.20 24.30
ating Depts
Total
Assembly
2,000,000 13,752,150
3,937,500 6,300,000
161,350 1,452,150
6,098,850 13,752,150
ating Depts
Total
Assembly
2,000,000 13,752,150
3,150,000 6,300,000
301,350 2,712,150
5,451,350 13,752,150
ating Depts
Total
Assembly
2,000,000 13,752,150
3,150,000
271,215
135,608
ating Depts
Total
Assembly
2,000,000 13,752,150
3,288,300
276,750
5,565,050 13,752,030
Departments
Total
Stores
18,660 207,200
Departments
Total
Stores
18,660 207,200
-
(18,660) -
- 207,200
Departments
Total
Stores
18,660 207,200
(18,660) -
-
- 207,200
Departments
Total
Stores
18,660 207,200
3,940 39,360
22,600
207,200
Overhead
61,500 69,300
7,800
Cateen
1,250
18,000
21,062
Cateen
21,062
(21,062)
-
Service Cost Centre
X Y
3,795 6,130
4,640 5,750
8435 11880 195,243
1485 -11880
(9,920)
195,243
Employee facilities
84,000
3,780
3,000
940
91,720
Employee facilities
91,720 439,000
(91,720)
- 439,000
MG1 MG2 MG3
12,600 8,400 12,600
13,000 6,500 6,500
15,920 13,930 9,950
41,520 28,830 29,050
marketed
=> finished good COS
activity
................................. 2,500,000
================= 500,000
er - absorption
COS
activity
2,500,000
300,000
vice Departments
Total
Stores
2,560 19,200
Total
33,600
26,000
39,800
Revision for Mid term
Chapter 1: Q7, 8, 9, 10
Manufacturing costs (product costs, inventorial costs)
DM
DL
MO
Marginal cost
+ Inventorial costs = a + b + c
+ Contribution margin = Revenues - (a
Absorption costs
+ Inventorial costs = a + b + c + d
+ Gross profit = Revenues - (a + b + c
a) Absorption costings
Income statement under absorption costing
Revenues (20*9,000)
Less:
COS (2 + 3 + 3 + 4)*9,000
Less: over - absorbed
Gross profit
Less:
Variable selling costs (1*9,000)
Fixed selling costs (2*10,000)
Net income
b) Marginal costing
Revenues (20*9,000)
Less: Variable costings
Variable costs of COS (2+3+3)*9,000
Variable selling costs (1*9000)
Contribution margin
Less: fixed costs
Fixed manufacturing costs
Fixed selling costs
Net income
d)
Beg units of inventory
End units of inventory
End units > Beg units (difference)
=> Net income under Ab > Net income under Ma
Net income under Ab
Less: Differences
(5,000*8)
Net income under Ma
Q4
Produce 5,800 > Sales 5,200 => Net income under Ab > Net in
Actual fixed overhead:
Budgeted fixed overhead: (5*5,000)
c) Reconciliation
Net income under Ab
Less: Net income under Ma
Difference
x x
x x
es (production departments)
e f
h g
b+c+d
es - (a + b + c + d) of goods sold
es => end units of inventory > beg units of inventory => Net income undwer Ab
der marginal cost = Net income under Ab - OAR * (End units of inventoy - Beg
es => end units of inventory < beg units of inventory => Net income under Ab <
der Ab = Net income under Ma - OAR * (Beg units of inventory - End units of in
1 2
- -
elling overhead
2*9,000
CU: $
180,000
COS
108,000
(4,000) 104,000
76,000
(9,000)
(20,000)
47,000
CU: $
180,000
72,000
9,000
99,000
40,000
20,000
39,000
47,000
39,000
8,000
8,000
15,000
20,000
5,000
130,000
(40,000)
90,000
156,000
(83,200)
156,000 29,000
109,200
Over-absorbed = 29,000
(1,600) 107,600 Dr Fixed overhead
48,400 Cr COS
48,400
(45,400)
3,000
600
5
3,000
prime cost conversion cost
x
x x
x
($/DLH*DLHs
nder absorbed)
over absorbed)
ome undwer Ab > Net income under Ma
inventoy - Beg units of inventory)
29,000
Q1
Selling price per unit 10
Less: Variable cost per unit 6
Contribution margin per unit 4
(cmu)
if sales of 10,000
Sales revenues 100,000
Less:
Variable costs (60,000)
Contribution margin 40,000
Less: Fixed costs (45,000)
Net income (5,000)
Q2
b) Net profit under marginal costing
Sales revenue (35*1,500)
Less: Variable costs
+ Variable prodution costs 22,500
(5+8+2)*1500
+ Variable S & A costs 7,875
(52,500*15%)
+ Total variable costs
Contribution margin
Less: Fixed costs
+ Fixed manufacturing cost 15,000
+ Fixed S & A costs 10,000
Net income (loss)
d) Reconciliation
Production = 2,000 (units) > sales = 1,500 (units) => difference =
Beg inventory = 0, end inventory = 500 (unit) => End > Beg =>
OAR/unit
Difference (5*500)
Net profit Under Va
OAR per unit
Difference in unit
=> Net profit under Ab = Net prof
=> Net profit under Ab = Net prof
Q3
a) Marginal cost
Sales revenue (20*9,000)
Less Variable costs
(2+3+3+1)*9,000
Contribution margin
Less Fixed cost
Fixed MC (4*10,000)
Fixed Selling costs (2*10,000)
Net profit
b) Absorption cost
Sales revenue (20*9,000)
Less: COS
(2+3+3+4)*9000 108,000
Less: Over-absorbed (4,000)
Gross profit
Less: Selling
- Variable (1*9,000)
- Fixed costs (2*10,000)
Net profit
Reconcile:
Beg unit = 0, end units = 0+11,000-9,000 = 2,000 => end units >
Difference = (2,000-0)*OAR = 2,000*4 =
Q4
Inventorial
(Marginal costing)
6.00
7.50
2.50
____
16.00
a) Net profit under marginal costing
Revenue (30*5,200)
Less: Variable costs (16*5,200)
CM
Less: Fixed cost
Net income
c) Reconciliation
Net income under Va
Net income under Ab
Difference
Units produced (5,800) > Unit sold (5,200):
OAR
Difference
Q5
a/ Sales revenue (12*45,600)
COS (5.2 + 2.8)*45,600
Under absorbed (over-absorbed)
Gross profit
Less: Non production costs
Variable costs (0.65*45,600)
Fixed costs (1.7*46,000)
Net profit
b/
Beg units -
End units (46,000 - 45,600) 400
End units > Beg units => Net income under Ab > Net income Ma
Net income under Ab = Net incom
74,560 = Net income under Ma +
=> Net income under Ma = 74,56
Why?
A portion of fixed MO is deferred in ending inventory => Total co
Q7
1a) Income statement under absorption costing
Revenues (22*345,400)
Less:
COS (5.1 + 4.8)*345,400 3,419,460
Under absorbed 24,480
Gross profit
Less:
Variable operating cost (1.1*345.400)
Fixed operting costs
Net income
2/ absorption costing
Net income 2,694,920
Sales revenue 7,598,800
Net income/sales revenue% 35.47%
x
x
period
x
x
x
x
ues - COS
Admin costs
ariable costs (Variable cost of COS + Variable selling cost + variable admin co
Fixed manufacturing costs + FC of selling + FC of admin costs)
if sales of If sales of
15,000 20,000
150,000 200,000
(90,000) (120,000)
60,000 80,000
(45,000) (45,000)
15,000 35,000
52,500
30,375
22,125
25,000
(2,875)
52,500
35,000
17,500
7,875
10,000
17,875
(375)
(2,875)
(375)
(2,500)
fit under Ab = Net profit under Va + Difference in unit * OAR (End units > Beg
fit under Ab = Net profit under Va - Difference in unit * OAR (End units < Beg
81,000
99,000
40,000
20,000
39,000
Manufacturing overhead
actual
180,000 40,000
4,000
104,000
76,000
9,000
20,000
47,000
47,000
39,000
8,000
= 2,000 => end units > beg units => Net profit under Ab > Net profit Va
8,000
Inventorial
(Absorption
costing)
6.00
7.50
2.50
5.00
21.00
156,000
83,200
72,800
27,400 over-absorbed
45,400
156,000
107,600
48,400
45,400
48,400
3,000
600 Net income under Ab = Net income under Va + (End
5
3,000
547,200
364,800
-
182,400
(29,640)
(78,200)
74,560
g inventory => Total costs deducted from sales revenues under Ab < Total cos
7,598,800
3,443,940
4,154,860
(379,940)
(1,080,000)
2,694,920
7,598,800
(1,761,540)
(379,940)
5,457,320
(1,440,000)
(1,080,000)
2,937,320
Marginal costing
2,937,320
7,598,800
38.66%
4.500) => Net income under Ab < Net income under Ma
nits - End units)*OAR
50,500
4.80
242,400
s - Expenses
ofit under Va
COS
1,600
et income under Va + (End units - Beg units)*OAR
Overhead
Actual Absorbed
128,800 128,800
enues under Ab < Total costs deductd from sales revenue under Ma
Overhead
Actual Absorbed
1,440,000 1,415,520
24,480 under absorbed
COS
30,000
5,000 35,000
COS
4,000
evenue under Ma
sorbed
Chapter 4: Job costing
Q1
1)
Direct material costs
Direct manufacturing labor costs
Manufacturing overhead costs
OAR (2,700,000/1,500,000)
(2,755,000/1,450,000)
2)
Direct material costs
Direct manufacturing labor costs
Manufacturing overhead costs
3) Actual MO costs
Absorbed (1.8*1,450,000)
Under absorbed
Q2
1)
Assembly support costs ($)
DLHs (hours)
OAR
DM
DL
Assembly support costs
DM
DL
Assembly support costs
3/ Able to calculate cost of job just after job completed => making d
Q3
1)
Manufacturing overhead
Direct manufacturing labor costs
Direct manufacturing labor-hours
Machine-hours
Estimated OAR
2)
Absorbed MO of machining dep for Job 494 (36*2,000)
Absorbed MO of assembly dep for Job 494 (1.8*15,000)
3)
Actual MO
Absorbed MO
(36*55,000; 1.8*2,200,000)
Under absorbed
Over abosorbed
Q4
1) Budgeted OAR = Budgeted indirect costs/Budgeted professiona
= 13,600,000/5,312,500 =
2) Markup = 11%*revenue
Revenue
markup%
Markup (21,250,000*11%)
3)
a) Direct cost (professional costs)
Catergory
Director
partner
Associate
Assistant
Indirect cost (client support) (2.56*10,075)
Total costs
Q5
2) Cash, A/P => RM ====>WIP =======> Finshed goods ======
Dr RM and supplies
Cr A/P
Dr WIP
Cr RM
Dr Manufacturing overhead
Cr RM
Dr WIP
Cr Salary payable
Dr Manufacturing overhead
Cr Salary payable
Dr Manufacturing overhead
Cr Acc dep
Dr Manufacturing overhead
Cr A/P...
Absorbed MO = 1,300*160% =
Dr WIP
Cr MO
Dr COS
Cr Finished goods
Dr A/R
Cr Revenue
Absorbed MO
Actual MO
Over - absorbed
Q7
2) Direct cost rate ($104,000/1600 hours)
2,755,000
2,610,000
145,000
cost driver
of cost driver = Actual MO
Actual Budgeted
6,520,000 8,300,000
163,000 166,000
40.00 50.00
Actual Normal
106,760 106,760
36,950 36,950
38,400 48,000
182,110 191,710
Actual Normal
127,550 127,550
41,320 41,320
42,000 52,500
210,870 221,370
after job completed => making decision timely
50,000
36.00 1.80
Machining Assembly
2,100,000 3,700,000
1,980,000 3,960,000
120,000
260,000
21,250,000
11.00%
2,337,500
= 2,337,500/5,312,400*100%
44.00%
40,300
710
710
100
100
1,300
1,300
900
900
400
400
550
550
2,080
2,080
2,080
4,020
4,020
8,000
8,000
2,080
1,950
130
65.00
55.00
Richardson Punch
6,500 9,750
5,500 8,250
12,000 18,000
72,000
27,000
99,000
$
792
1,717
2,058
5,508
10,075
25,792
35,867
Finished goods
Open Bal 500
WIP ???
MO
RM 100
Salary payabl 900 2,080
Acc dep 400
A/P... 550
COS 130
2,080 2,080
Finished goods
4,020 COS
WIP
Chapter 5: Process, Joint and By product costing
A/ Process costing
a1/ When is this method adopted (slide 2)
a2/ Methods of calculating
Beg WIP + Manufacturing cost incurred in period = COGM + End
Case 2:
Beg WIP = 0
End WIP > 0
(a) => COGM = Beg WIP + MC incurred during the period - End
gas:
Costs of rice $& water for end WIP
Costs of gas: 100/(10+5*50%)*(5*5
Total End WIP
Case 3:
Beg WIP > 0
End WIP > 0
(a) => COGM = Beg WIP + MC - End WIP
case 3.1 Weighted average method
case 3.2 FIFO
Q1 Equivale
Q2 DM
Physical
1/ units P
Beg WIP -
Units started in July 50,000
Units to account for 50,000
Units completed & transferred 35,000 35,000
End WIP (2/3) 15,000 15,000
Units accounted for 50,000 50,000
$
Beg WIP - -
MC incurred in July 455,000 250,000
Total costs to account for 455,000 250,000
Cost per unit 10 5.00
Costs assigned to:
Units completed & transferred 350,000 175,000
End WIP 105,000 75,000
Total costs accounted for 455,000 250,000
Q3
a) weighted average method
(T% completion of Beg are ignored)
Equivalent units
Physical
units DM
Beg WIP 80
Units started in May 500
580
Units completed 460 460
End WIP 120 72
580 532
$
Beg WIP 584,400 493,360
MC incurred in May 4,612,000 3,220,000
5,196,400 3,713,360
Cost per unit 9,970 6,980
Assigned to:
Units completed 4,586,200 3,210,800
End WIP 610,200 502,560
5,196,400 3,713,360
b) FIFO
Equivalent units
Physical
units DM
Beg WIP 80
Units started in May 500
Total units to account for 580
Beg WIP 80 8
Started and completed in Ma 380 380
(460-80)
End WIP 120 72
Total units accounted for 580 460
$
Beg WIP 584,400 493,360
MC incurred in May 4,612,000 3,220,000
Total costs to account for 5,196,400 3,713,360
B) Joint Product/Costs
Q7
Split off
point
Joint Costs:
DM: $300
CC: $200
Soymeal Soyoil
Units 500 100
Total Joint Costs
Allocation rate (500/600)
Joint costs allocated 417 83
C/ By Product
* Definition: (slide 5) insignificant value in comparision with by pr
* Don't allocate common cost to by product
* Value of by product deducted from joint costs before sharing jo
Q5
3)
Wholesale
Selling Price
Pounds of per Pound
Parts
Product When
Production Is
Complete
4) Value of by-product => deducted from joint cost => allocate to main
Value of by products
Wholesale
Selling Price
Pounds of per Pound
Parts
Product When
Production Is
Complete
Wings 20 0.2
Bones 80 0.1
Feathers 10 0.05
Joint cost
Less: Value of byproduct
Joint cost allocated to main products
Wholesale
Selling Price
Pounds of per Pound
Parts
Product When
Production Is
Complete
Q6
Equivalent Units
DM
Conversion
Q costs
35,000 35,000
- 10,000
35,000 45,000
- -
70,000 135,000
70,000 135,000
2.00 3.00
70,000 105,000
- 30,000
70,000 135,000
Equivalent units
Conversion
cost
460
36
496
91,040
1,392,000
1,483,040
2,990
1,375,400
107,640
1,483,040
Equivalent units
Conversion
cost
48
380
36
464
91,040
1,392,000
1,483,040
3,000
91,040
144,000
235,040
1,140,000
108,000
1,483,040
Soy meal:
500
additional cost
pounds;sellin
g orice
$1/pound
300
Split off
point
200
Total
Revenue
1,700 Less costs
500 + Joint costs allocated
1,200 + Additional costs
Net profit (loss)
500 Difference (622 - 222)
0.42
Joint cost allocated = Sunk costs
500
500
Value
4.00
8.00
0.50
12.50
50.00
12.50
37.50
Allocation Allocated
Total sales Cost per unit
rate joint costs
additional cost
Turpentine
$2/gallon
methanol
$3/gallon
methanol
2,500 gallons
Methanol
Method 1 Method 2
s: 50% completion
Soy cookies: 600
pounds; selling price:
$2/pound
processed (stop)
urther processed)
A
B
=> futher be processed
Soy meal Soy oil
1,200 500
500 400
700 100
(300) (200)
400 (100)
Processed Stop
Soy meal Soy oil
Stop Processed Stop Processed
500 1,200 400 500
= Sunk costs
End End
inventory inventory
(units) (cost)
15 5.06
4 0.49
6 1.29
5 0.31
2 0.06
7.21
End End
inventory inventory
(units) (cost)
15 4.48
6 1.14
5.63
onal cost
Turpentine"
7,500 gallons
onal cost additional cost
methanol"
methanol"
2,500 gallons
Selling price = $21/gallon
tasting Beverage
tasting Beverage
$9/gallon
2/ Production budget
X Y Z
Unit sold 2,000 4,000 3,000
add : End finished good 600 1,000 800
less : Beg finished good 500 800 700
Finished goods produced 2,100 4,200 3,100
5/ Labor budget
X Y Z
Finished goods produced 2,100 4,200 3,100
Expected hours per unit 4 6 8
Labor hours used 8,400 25,200 24,800
hourly rate (labour) 9 9 9
Labor hours cost 75,600 226,800 223,200
Q5
a) Sales budget
Q1 Q2 Q3
Sales units 1,950 2,275 3,250
Selling price per unit 56 56 56
Sales revenue 109,200 127,400 182,000
b) Production budget
Q1 Q2 Q3
Sales units 1,950 2,275 3,250
Add: End finished goods 175 250 175
2,125 2,525 3,425
(150) (175) (250)
Produced units 1,975 2,350 3,175
c) Q1 Q2 Q3
Produced units 1,975 2,350 3,175
Units of DM/unit 3 3 3
Materials used 5,925 7,050 9,525
Add: end material - - -
5,925 7,050 9,525
Less: Beg material - - -
Materials purchased 5,925 7,050 9,525
Purchase price/unit 6 6 6
Total purchase cost 35,550 42,300 57,150
get (purchase)
d budget
Total
Q4 Q5
2,275 1,950
56 56
127,400 109,200
Q4 Q5
2,275 1,950
150
2,425
(175)
2,250
Q4
2,250
3
6,750
-
6,750
-
6,750
6
40,500 175,500
Chapter 7: Cost Standard and Variance Analysis
A/ Standard
B/ Variances Analysis
2 100,000
3 50,000
b1/ Direct material variances
Total variance = Actual costs - Standard Costs (allowed fo
b11) Price variance
Price variance = (actual price/material unit - standard price
actual price/material unit ($98,600/11,700kg)
standard price/material unit
Price variance = (8.43 - 10)*11.700
Reasons:
- Wrong standard
- Purchase managers find reasonable suppliers
- Relationship with quality of material
-.....
Reasons:
- Wrong standard
- Quality of material is not good => purchase manager
- Level of labor forces => personal managers, production
- Quality of machine, equipments
-.....
b13) total variance
Price variance (18,400)
Usage variance 17,000
Total variance (1,400)
Actual costs
Standard costs allowed for actual outpu
(10*1,000*10)
Variance (98,600 - 100,000)
Q5
Q11
1/ Total DL variance = (AH*AR - SH allowed for actual outpu
AH 49,000
AR (739,900/49,000) 15.10
Q7
Sales price variance = (Actual price/unit - Standard price/u
Actual price/unit 61
Budget price/unit 60
Sales price variance = (61 - 60)*6,000 =
100000*2
50000*3
nable suppliers
(F)
(A)
(F)
98,600
100,000
(1,400)
y used
d DLH allowed for actual output)*standard rate
(1,100) (F)
- SQ used)*SP = -1,500
190,000) = 3.050
adverse
unfavorable
DM
,000)*5 = 1,500 A
tiy sold
=> Favorable
adverse Unfavorable (U)
dard cmu (gross profit/unit)
uatity used
Chapter 8: CVP (costs - volume - profit)
A/ Some definitions
* Contribution margin
contribution margin per unit = selling price per unit
total CM = Sales revenue - To
Profit = Sales revenue - Costs = Sales revenues - (
= (sales revenues
= total CM - FC
BEP in $
Method 1: solving equation => Q => $
Method 2: cm ratio
Q1 1)
2) Revised cases
BEP in units = 5,330,000/(68-54) =
BEP in $ = 5,330,000/20.59% =
Operating income = total CM - FC
= (68 - 54)*410,000 - 5,330,000
3) No
BEP in units, in $ under revised case > those under
Q4
1a; 100,000
1b; 2,250,000
cm ratio
BEP in $
2/
variable cost/unit = 0.3 + 0.04 = 0.34
3/
FC = 900,000*110%
Units sold = 5,000,000*110%
4/
FC = 900,000*80%
Variable cost/unit = 0.3*90%
Units sold = 5,000,000*140%
5/
FC = 900,000*110%
6/
p = 0.5*110%
FC = 900,000 + 20,000
BEP in units
Method 1: solving equation => Q of each product
Q2
b/Assume that:
Number of upgrade customer at BEP is X
=> Number of new customer at BEP is 4X
=> Sales revenue: 100X + 275*4X
=> Variable cos: 50X + 400X
=> FC
1,200X - 450X - 15,000,000 = 0
X = 15,000,000/(1,200 - 450) =
BEP in $
* Solving equation => BEP in $
cmu on average
selling price
Sales mix
selling price per unit on avera
c/ 4,800,000
cmu
Units sold
(220,000*80%; 220,000*20%)
Total CM
Less: Fixed cost
Net income
Q3
1/
2/ Coffee
Bagels
Q5
1/ Selling price per unit
Less: Variable cost/unit
- Purchase cost/unit
- Commission fee/unit
cmu
FC
+ Rent & ....
+ Sales people
+ Advertising
Total FC
BEP in units = FC/cmu = 129,200/3,400 =
2/ Operating income
Less: income tax (40%)
Net income (X - 0.4*X)
o (cm ratio)
price per unit = total CM/total sales
11.76% 7%
on => Q => $
Q = 205,000 (units)
p = 68
BEP in $ = 68*205,000 =
cm ratio = 11.76%
Q = FC/cmu => Q*p = FC/cmu*p = FC/ cm ratio
= 1,640,000/11.76% =
(BEP in units)
FC 5,330,000
v 54
p 68
Units sold 410,000
0/(68-54) = 380,714
.59% = 25,888,571
l CM - FC
68 - 54)*410,000 - 5,330,000 =
40.00%
2,250,000
0.04 = 0.34
ng and selling multiple products
table chair
1 2
5 10
10 20
tomer at BEP is X
omer at BEP is 4X
X + 275*4X 1,200
400X 450
15,000,000
000 = 0
450) = 20,000
80,000
100,000
EP in $
BEP in $ for new customer: 80,000*275 =
BEP in $ for upgrade customer: 20,000*100 =
BEP in $ for all products
0/240)
on average = 15,000,000/62.5% =
BEP in $ for new: 24,000,000/240*220 =
BEP in $ for upgrade: 24,000,000/240*20 =
New customer Upgrade
175 50
176,000 44,000
20%)
30,800,000 2,200,000
20,000 28,000
5,000 7,000
1.25*4X + 2*X = 5X + 2X
2,100
700
1,400
n fee) per unit (1,500,00*6%) 90
43
47
23,500
17,000
60
27,000
23,000
600 23,600
3,400
48,200
68,000
13,000
129,200
= 129,200/3,400 = 38.00
X
0.4*X
51,000
er unit
640,000/(68-60) =
> Q = FC/cmu
205,000 (units)
13,940,000 ($)
11.76%
C/ cm ratio
13,940,000 (s)
cm ratio = (68-54)/68 =
410,000
X
X
=> upgrade
=> new
cmu on average
150
100,000
0,000*80% = 80,000
*20% = 20,000
22,000,000
00*100 = 2,000,000
or all products 24,000,000
on average
150
240
62.50%
24,000,000
22,000,000
0*20 = 2,000,000
Total
33,000,000
15,000,000
18,000,000
16,000
4,000
= 7X = 35,000
=> X = 35,000/7 = 5,000
=> 4X = 20,000
25,000
BEP in units = 23,500/47 =
BEP in $ = 90*500
205,000 (units)
20.59%
33,000,000
its = 23,500/47 = 500
= 90*500 45,000
Total variance =
b) Direct materials
Total direct material variance = ?
This variance includes 2 sub- variances: Price variance =
Some reasons for variance of price variance: (F)
=> Wrong budget
=> Effort of purchase deparment
=> Market price decreases
=> Price <===> quality
.....
Some reasons for usage variances:
=> quality of material is not good
=> Level of labor force is low
=> machine is out of date
....
Q3
1a) selling price
FC (7,250,000 + 1,570,000)
BEP
2) 125417
Assume number of units sold:
Sales revenue
Variable costs
FC
Net profit
Q21 (budget)
Units produced
Kg of material/unit
Material used
Add: End material
Cash payment
(số tiền phải trả để sản xuất cho nhà sản xuất)
Q2
a) FIFO
Beg wip
Units started in Sept
WIP
Costs incurres in Sept
Total costs to account for
Beg wip
Units started in Sept
Finished goods
End WIP
WIP
Costs incurres in Sept
Total costs to account for
costs per EU
Assigned costs to
Finished goods
End WIP
Total costs accounted for
b) Absorption cost
Revenue (100*2,900)
Less: COS (44*2900)
Add: under absorbed (w)
Gross profit
Less:
Selling & Admin costs
Net income
c) Beg inventory
End inventory (3,000 - 2,900)
End inventory > Beg inventory <==> Production > sales
=> Net income under Ab > Net income under Variable co
Difference (152,900 - 152,500)
Q3 Budgeted pice
Actual price (2,250,000/50,000)
Actual quantity sold
Q4
1/ Marginal costing
Revenue (100*3,000)
Less: Variable costs
DM costs (24*3,000)
DL costs (15*3,000)
Variable production OH (6*3,000)
Contribution margin
Less: Fixed costs
Fixed production overhead
Fixed selling, admin costs
Net income
2/ Absorption
Revenue (100*3,000)
Less: COS
(15 + 24 + 6 + 5)*3,000
Deduct: Over absorbed
Gross profit
Less: Selling & Admin cost
Net income
Q5
Variable cost vs Absorption cost (chapter 3)
Process Costing, joint cost (chapter 5)
Budgeting (chapter 6)
Variance (chapter 7)
CVP (chapter 8)
Ex
a) Sales mix (unit)
Sales mix
cmu (250-100); (350-150); (500-250)
BEP in $ = ?
BEP in $ = FC/cm ratio on average
FC
cm ratio on average
BEP in $ (3,315,000/55.71%)
BEP in $ for Good (5,950,000*75/350)
BEP in $ for Better (5,950,000*175/350)
BEP in $ for Best (5,950,000*100/350)
c/
Q target = (FC + Profit target)/cmu on average
FC
Profit target
cmu on average
Q target (3,315,000 + 234,000)/195
d/
cmu
current sales mix
proposal sales mix
Assumptions of CVP
Sales mix is not changed
Selling price per unit; variable cost per unit are constant
Expenses can be expressed in linear program:
Total costs = FC + variable cost per unit* Total Units
Time Value of money can be ignored
Total costs can be divided into fixed and variable costs
AP - SP)*AQ purchased
3.40
3.60
,000 = (106,000)
SQ)*SP
530,000
522,000
00 - 522,000)*3.6 28,800
(77,200) (F)
19.80
19.50
,000 = 133,500
445,000
435,000
35,000)*19.5 = 195,000
328,500
77,200 F
ances: Price variance = ?; Usage variance = ?
e variance: (F)
kh
210/unit
8,820,000
120,000
3,822,000
0*210*65% - 8,820,000 =
y
210*y
210*y*65%*80%
8,820,000
3,822,000
3,822,000 = 210*y - 210*y*65%*80% - 8,820,000 => y
1,953,000 2,289,000
nhà sản xuất)
Equivalent units
Physical unit Direct Conversion
materials costs
80
720
800
80 40 32
570 570 570
150 135 60
800 745 662
$ DM CC
550,000 460,000 90,000
5,110,000 3,560,000 1,550,000
5,660,000 4,020,000 1,640,000
Equivalent units
Physical unit Direct Conversion
materials costs
80
720
800
650 650 650
150 135 60
800 785 710
$ DM CC
550,000 460,000 90,000
5,110,000 3,560,000 1,550,000
5,660,000 4,020,000 1,640,000
7,430.88 5,121.02 2,309.86
290,000
69,600
34,800
11,600 116,000
174,000
12,500
9,000
152,500
290,000
127,600
500 128,100
161,900
9,000
152,900
-
100
=> Production > sales
come under Variable cost
400
65
45
50,000
P)*AQ purchased
2.20
2.00
240,000 Total DM
variance (F) vs
SQ)*SP (A), (U)
240,000
250,000
2
5.50
6.00
250,000 Total DL
variance (F) vs
- SH)*SR (A), (U)
250,000
200,000
6
$
300,000
72,000
45,000
18,000
165,000
12,000
15,000
138,000
$
300,000
144,500
150,000 Fixed manufacturing OH
(5,500) Actual
155,500 12,000
(15,000) 5,500
140,500
138,000
140,500
2,500
500
5
2,500
chapter 3)
average
3,315,000
195
17,000 CM
5,100 765,000
8,500 1,700,000
3,400 850,000
17,000 3,315,000
3,315,000
55.71%
5,950,000
1,275,000 1,275,000
5/350) 2,975,000 2,975,000
1,700,000 1,700,000
u on average
3,315,000
234,000
195.00
18,200
185.00
17,919 > 17,000
t per unit are constant
ear program:
per unit* Total Units
(U) or (A)
(U) or (A)
(U) or (A)
F
U
U
3,822,000
,820,000 => y
Nov
140,000
3
420,000
Fifo lấy cost incurres
weighted lấy total
Variable cost per unit in COS
DM 24
DL 12
Variable prod 4
40
Variable cost in COS
(24+12+4)*2,900 116,000 115,000
12,000
12,800
DM 24
DL 12
Variable prod 4
Fixed produc 4
Absporption c 44
Production overhead -
Fixed cost
Actual Absorbed
12,500 12,000 4*3000 must be = estimated OA
500 => Dr COS
manufacturing OH
Absorbed
17,500
100
100.00%
600
200
367
average of proposal will be lower
ue4
= estimated OAR*actual activity
- Nhóm: 2 <=......<=6
- Lập dự toán
+ Số lượng loại sản phẩm: 2
+ Số lượng loại NVL: 2
=> DT bán hàng => Dự toán SX => NVL (sử dụ
=> Dự toán cho cả (chi tiết cho mỗi quý)
=> HTK (NVL, thành phẩm) có tồn đầu kỳ và tồ
Tờ bìa
Tên các thành viên + ID
Phần 1: Giới thiệu về công ty
Phần 2:
+ Căn cứ dự toán
+ Số liệu cụ thể để lập từng dự toán