Lolo Company incurred the following cost last year: RM RM Direct material 216,000 Sales salaries 65,000 Factory rent 24,000 Advertising 37,000 Direct labour 120,000 Depreciation on the headquarters building 10,000 Factory utilities 6,300 Salary of the corporate receiptionist 30,000 Supervision in the factory 50,000 Other administrative costs 175,000 Indirect labour in the factory 30,000 Salary of the factory receiptionist 28,000 Depreciation on factory equipment 9,000 Sales commission 27,000 Required: a) Classify each of the costs using the following table format. Be sure to total up the amounts in each column. (10 marks) Product costs Period costs Costs Direct material Diract labour Manufacturing overhead Selling expenses Administrative expenses Example: Direct material 216,000 b) What was the total product costs for last year? (1 mark) c) What was the total period costs for last year? (1 mark) d) If 30,000 units were produced last year, what the unit product cost? (3 marks)

X-Men Sdn Bhd (XMSB) is developing a cost accounting system. Initially XMSB decided to create four cost centers: AX and BX are Production Departments, CX and DX are Service Departments. The overhead cost for a period are as follows: The following overhead details have been estimated for the next period. Total RM Rent 85,000 Canteen 52,000 Rent and rates 68,000 Insurance of equipment 46,000 Supervision 35,000 Depreciation on equipment 48,000 The following information is also available: Total AX BX CX DX Floor area (sq m) 4,700 2,000 1,500 700 500 Value of equipment RM180,000 RM30,000 RM20,000 RM70,000 RM60,000 No. of employees 60 20 20 10 10 During the period, XMSB estimated that there will be 3,000 machine hours and 9,800 labour hours worked. For re-apportionment, CX works 80% for AX and 20% for BX, and DX works 70% for AX and 30% for BX. Required: a) Allocate production overhead costs over the AX, BX, CX and DX Departments using suitable basis for each department. (Note: Rounding up your answers to the nearest integer numbers). (10 marks) b) Apportion Service Department costs over Production Departments. (4 marks) c) For each Production Department, calculate an overhead rate based on machine hours (AX) and labour hours (BX), which later may be used to absorb production overhead cost into jobs. (Note: Rounding up your answers to the nearest two decimal numbers). (3 marks) d) Find the overhead cost of a job which spends 5 machine hours in AX and 4 labour hours in BX.

Question 1 Lolo Company incurred the following cost last year: RM RM Direct material 216,000 Sales salaries 65,000 Factory rent 24,000 Advertising 37,000 Direct labour 120,000 Depreciation on the headquarters building 10,000 Factory utilities 6,300 Salary of the corporate receiptionist 30,000 Supervision in the factory 50,000 Other administrative costs 175,000 Indirect labour in the factory 30,000 Salary of the factory receiptionist 28,000 Depreciation on factory equipment 9,000 Sales commission 27,000 Required: a) Classify each of the costs using the following table format. Be sure to total up the amounts in each column. (10 marks) Product costs Period costs Costs Direct material Diract labour Manufacturing overhead Selling expenses Administrative expenses Example: Direct material 216,000 b) What was the total product costs for last year? (1 mark) c) What was the total period costs for last year? (1 mark) d) If 30,000 units were produced last year, what the unit product cost? (3 marks) (Total: 15 Marks)