{T1 {an which ofthe folowing statements is alse? JB nancial accounting information canbe used fr interna reporting purposes. fo) Routine information can be used to make decisions regarding bth the longterm and shor term. () Management accounting provides information relevant to deciion making planning, cntl and levluation of performances, 1 cos accounting can only be used to provide inventory valuations fr intermal reporting \a2 which TWO of the following statements about management accounting information are true? ey are required by aw tobe produced hey are for use by parties external to the organisation (a3 cost contre is ) A production department where all production costs are aggregated 1) An area of the business accountable for both costs and revenues 10} The part ofthe business where all costs are paid to suppliers torial 1 Cost classifications (04 Prime costs ) Al cost incurred in manufacturing a product i () The material cost of a product 1) The cost of operating a department 105 a company employs three drivers to deliver goods tits customers. The salaries are paid to these livers ae: ) Apart of prime cost 18) A direct production expense 1A production overhead (as what ae the three major elements of product costs in @ manufacturing company? (07 Below are listed various costs that are found in organizations. [1 Hamburger buns ina McDonarlds’ outlet. (variable/| 2. Advertising by a dental office. (RBH seling and admin cost) B. Apples processed and canned by Del Monte Corporation. (arable Shipping canned apples form a Del Monte plant to customers, variable 5 nsurance on a Bausch amp; Laub factory producing contact lenses. HH/ product cost) 1c. salary ofa supervisor overseing production of circuit boards at Hewlett-Packard. (xed GRE 7. Insurance on IBM's Corporate Headquarters. (ned '. Commission paid to Encyclopedia Britannica salespersons. (varable/| Depreciation of factory lunchroom facies a a General Electric plant. (BH/ selling nc admin cost) 10. Steering wheels installed in BMW. (variable [a8 The total costs incurred at various output levels fora process operation ina factory, have been Imessured 2 follow: loutput Total cost ers (ray hi.500 102,476 COW 12,000 108,730 12,500 106,263, 13,000 108,021 hi3.500 110,727 13,000 113,201 HGH Reauired Using the highow technique, analyse the costs ofthe process operation into fied and variable letements (ans: Variable cost per unit=RM 29 Bamp: Total xed cost=RNS3,141) [Answer cost arable cost per unit = s1x201-102476 14000 —13500 ‘Bune eam 429 otal cost = Fixed cost + Variable cost 1113201 =x + (14000% 429), IM53161 los {B sén. Bh, manufactures and sells single product The management accountant has prepared iexed Ibudgets at two activity eves. The folowing data have been collected forfour cost types; A, 8, and Cat two activity levels (cost type Costat 100 units Cost at 140 units (aa) (am) 9400 10,220, e ‘4,000 4,000 c 6200 8.580 b 6400 3,260 Required {a} Caleuate and identify each ofthe four (4 cst types whether itis variable, semi-vaiabe or ied, {cost type Cost @100 units (RM) Cost @140 units (RM) Cost behaviour A 9,400/100= 34 10,220/140= 73 Semi-variable (eilf cost and cost per unit), 8 4,000 ‘4,000 Fixed (cost remain the same) c {6,200/100= 62 8,680/140=62 Variable (cost per unit same) D 16,400/100 64 8,260/140=53._Semi-ariable (iff cost and cost per unit) Fed cost = cost remain the samme arable cost = cost per unit remain the same ‘semi-variabe = ciffin cost and cst per unit (010 A company has prepared a flexed budget at two activity loves. The cost per unit af three costs ven below. All three casts behave in linear manner with respect t activity, Activity levels units) cost 10,000 15,000 k RMB perunit_ RM per unit Hy RM perunit RM per unit 3.50 per unit RMB per uit {seach ofthe costs variable, semi variable or fixed? YZ 3) Variable Fixed Semi varable 15) variable Fixed Variable Fixed Variable Semi variable 1) Fixed Variable Fxed k= fixed cost [> Activity Increase, Cost per unit decrease, total cost remain constant = variable cost > Activity hl increase/decrease, Cost per unit remain constant, total variable cost increase emivariable cost [> Dif incostand cost per unit 1. Criteria lnoaoa x 3.5 =3s000 lasa09 x2 = 30000 I> Total cost not remain constant then not equi Fined cost 2. iffin cost per unit = RMS,50 and RMB, then definitely nota variable cost also Total cost increase, cost per unit decrease