Assignment 1: Scope of Management Accounting and Cost Classification

Question 1-7: How would you classify the following in terms of Direct or Indirect materials?

Question 8-37: How would you classify the following in terms of (A) Prime Cost,(B) Production Overhead,(C)Administration Overhead, (d)Selling Overhead and (E) Distribution Overhead?

1. Royalty per unit of Production

* C * B * A * D * E

2. Lubricating Oil (factory)

* C * B * E * D * A

3. Traveling expenses of Salesmen

* E * D * A * C * B

4. Carriage Inwards of Raw Materials

* D * B * E * A * C

5. Entertainment expenses of salesmen

* E * A * B * D * C

6.Chief Accountant's Salary

* E * C * D * A * B

7. Petrol used in running a motor car engine

* Indirect Material * Direct Material

Question 8-37: How would you classify the following in terms of (A) Prime Cost,(B) Production Overhead,(C) Administration Overhead, (d) Selling Overhead and (E) Distribution Overhead?

8. Repairs to Machinery

* D * C * B * E * A

9. Boiler Fuel

* E * A * B * C * D

10. Accomodation expenses of salesmen

* B * E * C * A * D

11. Hire of computer in accounts office

* B * A * C * D * E

12. Glass used in spectacles

* Indirect Material

* Direct Material

13. Depreciation (MAchinery)

* B * D * C * A * E

14. Expenses on Factory Canteen

* D * A * B * E * C

15. Toilet supplies (factory)

* D * E * A * B * C

16. Toilet supplies (Office)

* C * A * D * B * E

17. Paper used in printing a book.

* Indirect Materal * Direct Material

18. Insurance (Finished stock)

* C * D * A * E * B

19. Wages of Office boy in general office

* E * D * A * B * C

20. Production Manager's Salary

* B * E * A * C

21. Cloth used in making a dress

* Indirect Material

* Direct Material

22. Electric power in Factory

* D * A * E * C * B

23. Water used in making ice-cream

* Indirect Material

* Direct Material

24. Assembler's Wages

* B * D * C * A * E

25. Office Salaries

* D * E * B * A * C

26. Wages of crane driver in factory

* D * A * E * B

27. Raw Materials Used

* D * A * E * C * B

28. Delivery Expenses

* B * E * A * C * D

29. Bad Debts

* B * E * D * A * C

30. Time-keeper's Wages

* E * C * A * B * D

31. Water used in making ice

* Indirect Materail

* Direct Material

32. Wages of Store Clerk

* B * E * A * D * C

33. Timber used in constructing a home

* Indirect Material

* Direct Material

34. Wages of crane driver in in haulage company

* A * E * B * D * C

35. Advertising

* B * C * A * E * D

36. Foremen's Salaries

* C * E * B * A * D