ASSESSOR ASSESSMENT PACK

Unit Code FNSACC507A

Unit Title Provide management accounting information

This unit describes the performance outcomes, skills and knowledge required to gather,
Unit Summary record and analyse operating and cost data, prepare budget reports and review costing
systems integrity to calculate and record the costs of products and services.

Prerequisites Units N/A

Co-assessed This unit is not co-assessed with any other unit

Assessment 1 – Project 1
The student is required to demonstrate their skills and knowledge in prepare a series of
statement for business and how to store the financial data
Assessment Methods
Assessment 1 – Project 2
The student is required to demonstrate their skills and knowledge to calculate the
operating and cost data, prepare the internal management reports
Assessment Pack Content - Assessment Competency Mapping
- Assessment Methods
- Assessment Task Summary
- Specific Resources required / Conditions and location of assessment
- Evidence gathered
- Marking guides / Observation Checklist / Expected Responses
Appendix:
- Assessment Summary Sheet (Reporting and Recording requirements)

Note This assessment pack must be read in conjunction with the Training and Assessment
Strategy of this qualification
 FNSACC507A Provide management accounting information

ASSESSMENT SUMMARY SHEET

(recording and reporting requirements)

This form is to be completed by the assessor and used as a final record of student’s competency. All student
submissions including any associated checklists/ hardcopy tests (as outlined below) are to be attached to this cover
sheet before it can be submitted to the student support department. For Multiple Choice Tests, a summary of the
Multiple Choice Test results is to be attached. Students must achieve a satisfactory result for all assessments to be
deemed competent for this unit.

Student Name:

Student ID No:

Final Completion Date:

Unit Code and Unit Title: FNSACC507A Provide management accounting services

Please attach the following documentation to this form Result achieved

Assessment 1  Project Task 1  Satisfactory  Not Satisfactory

Assessment 2  Project Task 2  Satisfactory  Not Satisfactory

State any reasonable adjustment(s) if applicable:

Final Assessment Result for this unit  Competent  Not Yet Competent

Assessor Name: ______________________

Assessor: I declare that I have conducted a fair, valid, reliable and
flexible assessment with this student, and I have provided appropriate Signature: ____________________________
feedback.
Date: ____/_____/_____

Student: I confirm that my assessments are my own work. I declare Signature: ____________________________
that I have been assessed in this unit, in a fair and flexible manner. I
have been provided with verbal feedback on my performance. Date: ____/_____/_____

Administrative use only:

Entered onto Student Management Database  ________________

Date Initials

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 FNSACC507A Provide management accounting information

Assessment 1- Project 1

Assessor Task Instructions

These instructions must be followed when assessing the student in this unit. The checklist on the following page is to be
completed for each student. Please refer to the Assessment Competency Mapping for specific details relating to
alignment of this task to the unit requirements. To achieve a satisfactory result for the project assessment task, students
must satisfy all requirements indicated in the assessor project checklist for this task.
Submission Date Assessor to advise the student on submission date
1 A. If you are the management accountant of a medium sized company what sort of a system would you set up to
retrieve the cost data?
- How would you ensure the appropriate departments staff are aware of what is required of them?
- How would you go about gathering the data?

1 B. Lachlan Ltd prepared a summary showing the following expected costs for a production and sales level of 20 000
units:
$
Conversion cost 40 100
Direct material 48 600
Factory overhead 19 200
Financial expenses 17 500
Selling and administration expenses 66 000

Lachlan Pty Ltd accounts for all manufacturing costs as product costs.

Required:
Calculate the following total costs:
(a) Direct labour
(b) Production cost
(c) Period cost.

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2. Derwent Manufacturing Ltd produces rainwater tanks. The following information has been extracted from its
accounting records for the six months to 30 June 2013.
$
Inventories 1/1/13: Direct materials 49 900
Indirect materials 4 390
Finished goods 90 850
Work in process—direct materials 9 000
—direct labour 3 000
—factory overhead 3 000
Accounts receivable: Balance 1/1/13 92 700
Sales 960 180
Receipts 921 750
Discount allowed 15 430
Accounts payable: Balance 1/1/13 32 000
Purchases—direct materials 196 320
—indirect materials 17 560
—finished goods 37 380
Payments 248 190
Discount received 4 420
Factory plant and equipment: At cost 1/1/13 285 500
Accumulated depreciation 1/1/13 128 475
Depreciation—straight line @ 10% p.a. ?
Factory insurances: Prepaid 1/1/13 1 000
Payment of annual premium 1/3/13 6 420
Freight inwards: Direct materials 8 040
Indirect materials 950
Finished goods 4 320
Freight outwards 26 030
Wages and salaries: Direct labour 80 430
Indirect labour 30 600
Sales and administration 51 700
Factory maintenance 5 950
Factory lighting and power: Accrued 1/1/13 2 140
Payments 8 710
Other adjustments as at 30 June 2013:
$
Inventories: Direct materials 53 380
Indirect materials 4 720
Finished goods 89 535
Work in process—direct material 11 610
—direct labour 3 870
—factory overhead 3 870
Annual leave accrued/provided—factory 8 490
—sales and administration 4 300

Required:
Prepare using spreadsheet software a manufacturing statement and trading statement for the six months ended 30
June 2013.

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 FNSACC507A Provide management accounting information

3. Quokka (Aust.) Ltd budgeted to produce 30 000 units for the current year. Each unit was budgeted to require 4
machine hours to produce. Budgeted factory overhead costs were:
$
Variable 144 000
Fixed 156 000
300 000

Factory overhead is applied to production using machine hours.

Actual production for the year was 124 000 machine hours and overhead incurred was $308 600.

Required:
Calculate and show the following:

(a) (i) pre-determined factory overhead rate for the year (ii) under / over applied overhead.
(b) flexible budget formula
(c) amount of factory overhead applied in the year
(d) under- or over-applied overhead for the year (your answer must clearly indicate whether the amount is under or
over-applied)
(e) spending variance and the capacity variance.

4. How would you store financial data? Briefly discuss how you would ensure security of the financial data
Also discuss how you would ensure the financial data is protected from being erased or lost.

Expected Performance
The students are expected to be able to apply:
 Knowledge of principles and practices of budgetary control such as: double-entry bookkeeping and accrual
accounting
 Knowledge of principles of costing and costing system integrity
 The method of data protection including: back-ups, security procedure
* Please refer to the Checklist for project for more details.
Equipment and/ or any specific resources necessary for the assessment:

Refer to the Training and Assessment Strategy.

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 FNSACC507A Provide management accounting information

Assessment 1 – Project 1 Check List

Assessor Task Instructions
Please assess each student upon their completion of the project, and record their result in the checklist below. For a student
to achieve a satisfactory result, all requirements in the checklist must be completed satisfactorily (ticked ‘yes’).
Please complete below:
Student Name:

Student ID No:

Date Observed:

Suggested Answer
1 A System to generate cost related information would depend on the accounting / ERP software that an organisation
employs Student should specifically mention appropriate systems for the following:
• Coding of data
• Classification of data
• Data storage
• Data security
• Data protection / archival methods
1 B.
$ $
(a) Conversion cost 40 100 (b) Conversion cost 40 100
Less Factory overhead 19 200 Direct material cost 48 600
Direct labour 20 900 Production cost 88 700

(c) Selling and administration 66 000

Financial expenses 17 500
Period cost 83 500

2. Derwent Manufacturing Ltd

Manufacturing statement for six months ending 30 June 2013
$ $ $
Direct materials
Work in process 1 January 2013 9 000
Stock 1 January 2013 49 900
Purchases 196 320
Freight in 8 040
263 260
Less Work in process 30 June 2013 11 610
Stock 30 June 2013 53 380 64 990 198 270
Direct labour
Work in process 1 January 2013 3 000
Direct labour incurred 80 430
83 430
Less Work in process 30 June 2013 3 870 79 560
Prime cost 277 830
Factory overhead
Work in process 1 January 2013 3 000
Indirect materials used:
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Stock 1 January 2013 4 390
Purchases 17 560
Freight in 950
22 900
Less Stock 30 June 2013 4 720 18 180
Depreciation—factory P & E ($285 500 × 10% × ½yr) 14 275
Factory insurances ($1000 + 6420 × 4/12) 3 140
Indirect labour 30 600
Factory maintenance 5 950
Factory lighting and power ($8710 – 2140) 6 570
Annual leave—factory 8 490
90 205
Less Work in process 30 June 2013 3 870 86 335
Cost of production 364 165

(b) Derwent Manufacturing Ltd

Trading statement for six months ending 30 June 2013
$ $
Sales 960 180
Less Cost of goods sold
Finished goods stock 1 January 2013 90 850
Cost of production 364 165
Purchases 37 380
Freight inwards 4 320
496 715
Less Finished goods stock 30 June 2013 89 535 407 180
Gross profit $553 000

3. (a) (i) Overhead application rate = ($50 000 + 100 000) ÷ 10 000 = $15 per DLH

(ii)
$
Factory overhead applied: ($15 × 9 700 DLH) 145 500
Less Actual factory overhead 149 000
Under-applied overhead (3 500)

(b) Variable overhead rate ($50 000 ÷ 10 000) = $5 per DLH

Flexible budget formula = $100 000 + $5 per DLH

(c)
Flexible budget
Actual O/h @ 9700 DLH (actual) Applied O/h
*V: $48 500
F: $100 000
$149 000 $148 500 $145 500

Spending variance Capacity variance

($500) Unf. ($3000) Unf.

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Total under-applied
($3500) Unf.

* Variable flexible budget = $5 × 9700 hours

4. When it comes to storing important financial documents storing records digitally can keep records from getting lost
-- or falling into the hands of identity thieves.
Storage methods include:

1. Web-based storage services

2. Storing financial files digitally
3. USB flash drives
4. External hard drives
5. CD-Rs and CD-RWs

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Assessment Result:
Assessor
Comments/Feedback on
student’s performance:
Student feedback (if any):
Assessor: I declare that I have
conducted a fair, valid,
reliable and flexible
assessment with this Student,
and I have provided
appropriate feedback
Did the student appeal the
assessment decision?
FNSACC507A Assessor Pack V3.0
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FNSACC507A Provide management accounting information
 Satisfactory
Assessor Name:
______________________
Signature:
___________________________
Date: ___/_____/________
 Yes
 No
 Not Satisfactory
Student: I declare that I Signature:
have been assessed in this __________________________
unit, in a fair and flexible
manner. Date: ___/_____/________
Student appeal outcome
(if applicable):
Page 9 of 24
 FNSACC507A Provide management accounting information

Assessment Task 2- Project 2

Assessor Task Instructions

These instructions must be followed when assessing the student in this unit. The checklist on the following page is to
be completed for each student. Please refer to the Assessment Competency Mapping for specific details relating to
alignment of this task to the unit requirements. To achieve a satisfactory result for the project assessment task,
students must satisfy all requirements indicated in the assessor project checklist for this task.
Submission Date Assessor to advise the student on submission date

1. A manufacturer has the following costs:

$
Administration expenses 70 000
Depreciation—plant 15 000
Factory wages—productive time 74 000
Factory wages—non-productive time 12 000
Direct materials used 128000
Selling expenses 38 000
Indirect materials used 14 000
Rates and insurances—factory 11 000
Financial expenses 26 000

All manufacturing costs are included in product cost.

Required:
Calculate each of the following amounts:
(a) prime cost
(b) conversion cost
(c) total product costs
(d) total period costs.

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2. The following information has been obtained from the accounting records of F Dinkum Ltd for the year ended 30
June 2013:
$ $
Stocks 1 July 2012:
Finished goods 55 800
Direct materials 60 200
Indirect materials 9 600
Work in process
—direct material 5 100
—direct labour 2 900
—factory overhead 2 900 10 900
Prepaid factory insurance 1 July 2012 3 100
Direct wages accrued 1 July 2012 1 300
Indirect wages accrued 1 July 2012 600
Purchases:
Finished goods 30 200
Direct materials 232 300
Indirect materials 32 400
Freight inwards:
Finished goods 1 600
Direct materials 8 300
Wages paid:
Direct labour 98 700
Indirect labour 42 100
Factory insurance—annual premium paid 1 March 2013 5 400
Factory power and gas 8 200
Sales 750 400
Discount received 3 200
Interest received 10 400
Advertising 29 800
Freight outwards 15 600
Office salaries 44 100
Bad debts 2 300
Discount allowed 1 800
Adjustments required as at 30 June 2013:
Stocks:
Finished goods 60 400
Direct materials 58 300
Indirect materials 11 800
Work in process:
—direct material 7 100
—direct labour 4 300
—factory overhead 4 300 17 700
Direct wages due but not paid 800
Depreciation at 20% p.a. straight-line on factory plant and
equipment costing $102 000
Required:
Prepare using a spreadsheet software the following internal management reports for F Dinkum Ltd for the year
ended
30 June 2013:
(a) manufacturing statement with appropriate classifications
(b) trading statement.
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3. A company makes specialised castings to customer orders. It uses a job-order system to cost its production.
Required:
Prepare general journal entries to record the following transactions for the month of April (all accounts are in a
general ledger):
$
(a) Materials purchases on credit:
Direct materials 25 000
Indirect materials 6 000
(b) Factory payrolls paid in the month total:
Gross wages 41 486
(c) Material requisitions total:
Direct materials 24 000
Indirect materials 8 000
(d) An analysis of labour time cards show:
Direct labour 31 690
Idle time 1 500
Other indirect labour 8 296
(e) Factory power used but not paid 1 240
(f) Depreciation on factory plant at 15% p.a. on cost value of $152 000
(g) Invoices received for direct production costs—
subcontracting on jobs 8 760
(h) Other invoices payable for factory overhead expenses 18 568
(i) Factory overhead applied—100% of direct labour ?
(j) Cost of jobs completed during April 98 750
(k) Cost of jobs sold on credit in April 109 500
(l) All jobs are invoiced at a mark-up on cost of 60%

4. (a) K. A. Ngaroo & Co Ltd specialises in the custom manufacture of moulded concrete products for the building
industry. Direct materials in the manufacturing operation are cement, sand, aggregate and steel. All other materials
are treated as indirect. The company uses a perpetual inventory system to account for stock. During August 2013
transactions relating to the operation of the factory store were as follows:

$
Materials on hand 1 August 2013 54 700
Purchases on credit of cement, sand, aggregate and steel 33 100
Purchases on credit of other materials 9 900
Freight paid for materials delivered to the store 1 300
Issues of cement, sand, aggregate and steel 37 200
Issues to the factory of other materials 10 400
Steel issued to a job was found to be the wrong gauge and returned
from the factory to the store; the store then returned the steel to
the supplier 2 200
Payments to accounts payable (after discounts received $400) 37 500
Gross wages of factory store employees 5 700
Materials on hand 31 August 2013 (from physical stocktake) 50 600

Required:
Enter the above information where appropriate in the Materials control account in the general ledger. Your answer
should show correct particulars (correct names for the other ledger accounts involved).

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b) Monotreme & Co. uses a perpetual inventory system. Stock on hand at 1 September 2013 of an indirect material
item used in the factory was 30 units @ $9 each. During September the following transactions occurred:
Sept. 5 Purchased 90 units @ $9.40 each (including freight in $0.25 each)
12 Issued 50 units

Required:
(i) Calculate the total cost of the issue on 12 September using the weighted average method to assign cost.
(ii) Prepare a general journal entry to record the issue on 12 September using the first-in, first-out inventory costing
method to assign cost. Show your workings.

5. Corella Ltd employs eight wage employees in its factory who are paid $25 per ordinary hour for a normal 38-hour
working week.

Factory payroll records showed the following total labour hours to be paid for March:
1064 Ordinary hours worked (including 900 hours on jobs)
152 Annual leave hours taken
1216 Total hours

Payroll deductions from gross pays of the employees were:

$
PAYG withholdings 5400
Superannuation contributions 1800
Medical fund contributions 1500

The company policy is to charge annual leave paid against the liability account Provision for annual leave. All
employees are entitled to a leave loading of 17½%.

The company’s superannuation guarantee liability for these employees for March is $2740.

Each employee has an annual entitlement of 4 weeks holiday pay plus 17½% loading. Each employee also has an
entitlement to 2 weeks sick leave per year. The company accrues/provides for all leave entitlements equally over each
month of the year.

Required:
Prepare general journal entries to record the following:
(a) gross factory pays for March and the payment of net pays
(b) allocation of the labour cost as direct and/or indirect
(c) accrual of the company’s superannuation guarantee liability
(d) accrual/provision of leave entitlements for March.

(Where necessary, round all final amounts to the nearest whole dollar.)

6. At a production level of 25 000 units the budgeted factory overhead cost in total is:
$
Fixed cost 123 000
Variable cost 50 000
173 000

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 FNSACC507A Provide management accounting information

Required:

(a) State the flexible budget formula.

(b) Calculate the budgeted per unit overhead cost if expected production is 30 000 units. (Note: you are required to
calculate
the overhead cost of one unit, not the cost in total.
(c) The production rate is normally 8 units per direct labour hour. What will be the predetermined overhead
application rate per direct labour hour if 30 000 units are produced?

7. A manufacturer collated the following data on machine hours and indirect material costs for the past five years:

Year Machine hours Cost

$
2008 6 100 18 000
2009 7 500 21 000
2010 5 400 16 400
2011 8 000 24 200
2012 8 900 24 100

Indirect materials are considered to be a semi-variable cost.

Required:
(a) Using the high-low method calculate:
(i) the variable cost per machine hour
(ii) total fixed cost per year.
Write your answer as a flexible budget formula.
(b) If production is estimated at 8200 machine hours for 2013, how much should be budgeted for indirect materials?

8. Quokka (Aust.) Ltd budgeted to produce 30 000 units for the current year. Each unit was budgeted to require 4
machine hours to produce. Budgeted factory overhead costs were:
$
Variable 144 000
Fixed 156 000
300 000

Factory overhead is applied to production using machine hours.

Actual production for the year was 124 000 machine hours and overhead incurred was $308 600.

Required:
Calculate and show the following:
(a) pre-determined factory overhead rate for the year
(b) flexible budget formula
(c) amount of factory overhead applied in the year
(d) under- or over-applied overhead for the year (your answer must clearly indicate whether the amount is under or
over-applied)
(e) spending variance and the capacity variance.

9. R. O’Sella Pty Ltd is a manufacturer making awnings to customer specifications. Job costing is used. The following
financial information is for September 2013.

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Details of work in process and finished goods stocks at 1 September:

$
Work in process—Job no. 103 9 440
Finished goods —Job no. 101 15 280
—Job no. 102 11 730

Other relevant account balances at 1 September:

$
Materials control 42 570
Labour control (labour accrued) 840 (Cr.)
Factory overhead control 460 (Cr.)
Transactions for the month:
$ $
(a) Credit purchases of materials 29 360
(b) Factory wages paid—gross 16 200
—PAYG withholding 3 250 12 950
(c) September invoices received for factory overhead 3 370
(d) Summary of materials requisitions:
Job no. 104 7 910
Job no. 105 5 540
Job no. 106 10 640
Job no. 107 3 780
Indirect 4 700 32 570
(e) Summary of labour time records
Job no. 103 1 750
Job no. 104 3 410
Job no. 105 2 350
Job no. 106 4 130
Job no. 107 930
Indirect 3 630 15 360
(f) Invoice payable for subcontracting work on Job no. 105 800
(g) Depreciation of factory plant and equipment at 15% p.a.
on cost of $132 000
(h) Factory overhead is applied to jobs at 100% of direct labour
cost
(i) At 30 September Job No. 107 was incomplete
(j) All completed jobs were sold in September except for Job no.
106

Required:
(a) Prepare a Job card cost summary for September 2013.
(b) Prepare and balance the following general ledger accounts:
(i) Materials control
(ii) Labour control
(iii) Factory overhead control
(iv) Work in process
(v) Finished goods.

10. The manager of a local restaurant prepared the following budget for June:
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 FNSACC507A Provide management accounting information

$
Average revenue per meal (including drinks) 35
Average variable expenses per meal 19
Fixed expenses (per month):
Wages 5900
Cleaning 800
Sundry restaurant expenses 4100

a) Prepare a cost volume profit report and show the number of meals per month required to break even.
b) What number of meals would be required for the restaurant to achieve a monthly net profit of $2800 (before
tax)?
c) Given a tax rate of 30% what number of meals would be required to earn a net profit of $2800 after tax?
(i) The restaurant currently cleans its own linen. This cleaning may be done by a local laundry
which would save the restaurant $300 in fixed expenses but would increase variable expenses
by $1 per meal. Calculate the new break-even point for the restaurant.
(ii) Should the manager have the linen cleaned by the local laundry? Explain you answer.

Expected Performance
The students are expected to be able to apply:
 Knowledge of principles and practices of budgetary control such as: double-entry bookkeeping and accrual
accounting
 Knowledge of principles of costing and costing system integrity
 The method of data protection including: back-ups, security procedure
* Please refer to the Checklist for project for more details.
Equipment and/ or any specific resources necessary for the assessment:

Refer to the Training and Assessment Strategy.

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Release Date 5th October 2015

Assessment Result:
Assessor
Comments/Feedback on
student’s performance:
Student feedback (if any):
Assessor: I declare that I have
conducted a fair, valid,
reliable and flexible
assessment with this Student,
and I have provided
appropriate feedback
Did the student appeal the
assessment decision?
FNSACC507A Assessor Pack V3.0
Release Date 5th October 2015
FNSACC507A Provide management accounting information
 Satisfactory
Assessor Name:
______________________
Signature:
___________________________
Date: ___/_____/________
 Yes
 No
 Not Satisfactory
Student: I declare that I Signature:
have been assessed in this __________________________
unit, in a fair and flexible
manner. Date: ___/_____/________
Student appeal outcome
(if applicable):
Page 17 of 24
 FNSACC507A Provide management accounting information

Assessment 2 – Project 2 Checklist

Assessor Task Instructions
Please assess each student upon their completion of the project, and record their result in the checklist below. For a student
to achieve a satisfactory result, all requirements in the checklist must be completed satisfactorily (ticked ‘yes’).
Please complete below:
Student Name:

Student ID No:

Date Observed:

Suggested Answer
1. (a)
$
Direct materials used 128000
Direct labour (productive time) 74000
202000

(b)
Direct labour 74 000
Factory overhead
Depreciation—plant 15000
Indirect labour (non-productive time) 12000
Indirect material 14000
Rates and insurances (factory) 11000 52 000
126000

(c)
$
Direct material used 128000
Direct labour 74 000
Factory overhead (as above) 52000
254000
There are alternative presentations for this answer (e.g. prime cost + factory overhead).

(d)
$
Administration expenses 70 000
Selling expenses 38 000
Financial expenses 26000
134000
2. (a)
F Dinkum Ltd
Manufacturing statement for year ended 30 June 2013
$ $ $
Direct materials
Work in process 1 July 2012 5 100
Stock 1 July 2012 60 200
Purchases 232 300
Freight inwards 8 300
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305 900
Work in process 30 June 2013 7 100
Less Stock 30 June 2013 58 300 65 400 240 500

Direct labour
Work in process 1 July 2012 2 900
Direct labour incurred ($98700 + 800 – 1300) 98 200
101100
Work in process 30 June 2013 4 300 96 800
Prime cost 337 300
Factory overhead
Work in process 1 July 2012 2 900
Indirect materials used:
Stock 1 July 2012 9 600
Purchases 32 400
42 000
Less Stock 30 June 2013 11 800 30 200
Indirect labour ($42 100 – 600) 41 500
Factory insurance ($5400 + 3100 – 5400 × 8/12) 4 900
Factory power and gas 8 200
Depreciation—factory plant and equipment 20 400
108 100
Less Work in process 30 June 2013 4 300 103 800
Cost of production 441 100

(b)
F Dinkum Ltd
Trading statement for year ended 30 June 2013
$ $
Sales 750 400
Less Cost of goods sold
Finished goods stock 1 July 2012 55 800
Purchases 30 200
Freight inwards 1 600
Cost of production 441 100
528 700
Less Finished goods stock 30 June 2013 60 400 468 300
Gross profit 282 100

3.
General journal
(a) Materials control 31 000
Accounts payable 31 000
Purchases on credit ($25 000 + $6000)
(b) Labour control 41 486
Payroll clearing/bank 41 486
Gross factory payroll paid
(c) Work in process 24 000
Factory overhead control 8 000
Materials control 32 000
Issues of direct and indirect materials
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(d) Work in process 31 690

Factory overhead control (1500 + 8296) 9 796
Labour control 41 486
Analysis of direct and indirect labour
(e) Factory overhead control 1 240
Accrued expense 1 240
Accrual of factory power
(f) Factory overhead control 1 900
Accumulated depreciation—factory plant 1 900
April depreciation 15% × $152 000 ÷ 12 mths
(g) Work in process 8 760
Accounts payable 8 760
Subcontracting on jobs
(h) Factory overhead control 18 568
Accounts payable 18 568
Invoices for factory expense
(i) Work in process 31 690
Factory overhead control 31 690
Overhead applied to jobs (100% × direct labour cost)
(j) Finished goods 98 750
Work in process 98 750
Cost of completed production
(k) Cost of goods sold 109 500
Finished goods 109 500
Jobs sold—at cost
(l) Accounts receivable 175 200
Sales 175 200
Jobs sold—at selling price (160% × $109 500)

4. (a)
Materials control
2013 2013
Aug. 1 Balance b/d 54 700 Aug. 31 Work in process 37 200
31 Accounts payable 33 100 Factory overhead 10 400
Accounts payable 9 900 Accounts payable 2 200
Bank 1 300 Cost of goods sold* 800
Work in process 2 200 Balance c/d 50 600
101 200 101 200
Sep. 1 Balance b/d 50 600
* Or Factory overhead or Materials variance
4. (b) (i)
Weighted average cost:
Balance 1 September 30 × $9.00 = $270
Purchased 5 September 90 × $9.40 = 846
120 $1116
$1 116
Average cost =
120 = $9.30
Issue 12 September = 50 × $9.30 = $465

(ii)
FIFO cost:

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50 units issued = 30 × $9.00 = $270
20 × $9.40 = 188
50 $458

General journal
Sept. 12 Factory overhead control 458
Materials control 458
Indirect material used

5. (a)
General journal
Mar. 31 Labour control (1064 × $25) 26 600
Provision for annual leave (152 × $25 × 1.175) 4 465
PAYG withholding 5 400
Superannuation payable 1 800
Medical contributions payable 1 500
Payroll clearing 22 365
Gross factory payroll for November
Payroll clearing 22 365
Bank 22 365
Payment of net wages

(b)
General journal
Mar. 31 Work in process (900 × $25) 22 500
Factory overhead control (164 × $25) 4 100
Labour control 26 600
Analysis of factory labour for month

(c)
General journal
Mar. 31 Factory overhead control 2 740
Superannuation payable 2 740
Company’s superannuation liability

(d)
General journal
Mar. 31 Factory overhead control 4 244
Provision for annual leave 2 977
Provision for sick leave 1 267
Annual leave provision (8 × 4 × 38 × $25 × 1.175 ÷ 12)
Sick leave provision (8 × 2 × 38 × $25 ÷ 12)

6. (a) Variable cost per direct labour hour = $50 000 ÷ 25 000 = $2.00 per unit.
Flexible budget formula: $123 000 + $2.00 per unit
(b) Budgeted per unit overhead cost for production of 30 000 units:
$ per unit
Fixed costs $123 000 ÷ 30 000 4.10
Variable cost $60 000 (30 000 × $2.00) 2.00
$183 000 6.10

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 FNSACC507A Provide management accounting information
(c) Eight units can be produced in 1 direct labour hour so the application rate is = 8 × $6.10 = $48.80 per direct labour
hour.

Alternative calculation:
30 000 units require 3 750 direct labour hours (30 000 ÷ 8)
Therefore application rate is $48.80 per DLH ($183 000 ÷ 3750)

7. (a)

(i) M/c hours Cost

Highest activity 8 900 $24 100
Less Lowest activity 5 400 16 400
Difference 3 500 $ 7 700
$7 700
Variable cost = 3 500 = $2.20 per M/c H

(b) Highest OR Lowest

Total overhead cost $24 100 $16 400
Less Variable cost: $2.20 × 8 900 19 580
$2.20 × 5 400 11 880
Fixed cost per year $ 4 520 $ 4 520

(iii) Flexible budget formula: $4520 + $2.20 per M/c H

(b)
Fixed cost component $ 4 520
Variable cost component $2.20 × 8200 18 040
Total budgeted cost for 2013 $22 560
$300 000
8. (a) Predetermined overhead rate: 120 000 = $2.50 per M/c H

(b) Flexible budget formula: $156 000 + $1.20 per machine hour
(Variable budgeted rate is $144 000 ÷ 120 000 hours)

(c) Overhead applied $2.50 × 124 000 M/c H = $310 000

(d)
Overhead applied = $310 000
Less Actual overhead $308 600
Over-applied overhead $ 1 400
(e)
Flexible budget
Actual O/h @ 124 000 M/c H (actual) Applied O/h
*V: $148 800
F: $156 000
$308 600 $304 800 $310 000

Spending variance Capacity variance

$3800 Unf. $5200 Fav.

Total over-applied
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$1400 Fav.

* Variable flexible budget = $1.20 × 124 000 M/c hours

9. (a)
Job card summary
Job 103 Job 104 Job 105 Job 106 Job 107 Total
Balance b/d $9 440 $9 440
Direct materials — $7 910 $5 540 $10 640 $3 780 27 870
Direct labour 1 750 3 410 2 350 4 130 930 12 570
Overhead applied 1 750 3 410 2 350 4 130 930 12 570
Subcontracting 800 800
Total 12 940 14 730 11 040 18 900 5 640 63 250

(b)
(i) Materials control
Sept. 1 Bal. b/d 42 570 Sept. 30 Work in process 27 870
30 Accounts payable 29 360 Factory overhead cont. 4 700
Bal. c/d 39 360
$71 930 $71 930
Oct. 1 Bal b/d 39 360

(ii) Labour control

Sept. 30 Payroll clearing 12 950 Sept. 1 Bal. b/d 840
PAYG payable 3 250 30 Work in process 12 570
Factory overhead cont. 2 790
$16 200 $16 200

(iii) Factory overhead control

Sept. 30 Accounts payable 3 370 Sept. 1 Bal. b/d 460
Materials control 4 700 30 Work in process 12 570
Labour control 2 790
Acc. dep’n fact. plant 1 650
Bal c/d 520
$13 030 $13 030
Oct. 1 Bal. b/d 520
(iv) Work in process
Sept. 1 Bal. b/d $9 440 Sept. 30 Finished goods* 57 610
30 Materials control 27 870 Bal. c/d 5 640
Labour control 12 570
Factory overhead 12 570
Accounts payable 800
$63 250 $63 250
Oct. 1 Bal. b/d 5 640
* Cost of jobs 103 to 106

(v) Finished goods

Sept. 1 Bal. b/d 27 010 Sept. 30 Cost of goods sold* 65 720
30 Work in Process 57 610 Bal. c/d 18 900

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$84 620 $84 620

Oct. 1 Bal b/d 18 900
* Cost of Jobs 101 to 105
10.
Contribution margin per meal: Total fixed expenses:
$ $
Revenue per meal 35 Wages 5 900
Less Variable expense per meal 19 Cleaning 800
CM per meal 16 Sundry restaurant expenses 4 100
10 800

$10 800
(a) Break-even point (meals) = $16 = 675 meals
$10 800  2 800
(b) Number of meals required = $16 = 850 meals
$2 800
(c) Profit before tax required = 70% = $4 000
$10 800  4 000
Number of meals required = $16 = 925 meals
(d) (i)
New contribution margin per meal:
$
Revenue per meal 35
Less Variable expense per meal 20
CM per meal 15

$10 500
New break-even point (meals) = $15 = 700 meals
(ii) If linen is cleaned by the local laundry, the break-even point increases from 675 meals to 700, making it more difficult for the
restaurant to earn a profit. The restaurant should continue to clean its own linen.

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