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Management accounting question. Help work on the question. Find details in the attachment. Jogi transporters operate in the transport industry. On 1/1/2016, the management acquired
Management accounting question. Help work on the question. Find details in the attachment.
Jogi transporters operate in the transport industry. On 1/1/2016, the management acquired a new lorry to meet customer needs and cater for the increase in business volume. Initial costs and maintenance are as follows; Cost - 12,000,000 Scrap value- 2000000 Annual road fee- 1200 Insurance premium per year- 400000 Replacement of tyres after every 25000km- 48000 Replacement of spare parts per service- 8000 Price of fuel per litre- 60 Additional information Economic life for the lorry-4years The lorry has 6 tyres each costing 8000 Service is carried out after every 5000km On average the lorry covers 20km for every litre consumed. The lorry is projected to cover 100,000km in January, 25000km in February and 50,000km in march 2006. Required; Prepare a schedule for the three months showing; Variable cost per km (2marks) ii. Fixed cost per km (2mark iii. Total cost per km (1mark) \"Fixed costs are actually variable cost\". With reference to (b) above, explain whether you agree or disagree with the statement (1marks) b. The following details have been obtained from the cost records of Brain steamer's Ltd. Stocks as at 1/9/2015; Direct wages - 52500 Indirect wages - 2750 Purchase of raw materialsFactory rent - raw materials - 75000 Finished goods- 54000 Work in progress- 28000 66000 15000 Depreciation on plant and machinery - 3500 Carriage on purchases - 1500 Office rent and taxes - 2500 Stocks as at 31/9/2015; raw materials - 91500 Finished goods- 31000 Work in progress- 28000 Required; Prepare a cost statement/ cost sheet to show total production cost as at 31/9/2015 (6marks)Step by Step Solution
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