- points QUESTION 45 Answer questions 12 & 13 using the information below: Wright Ltd uses an Activity-based Costing (ABC) system to manufacture tractor metal parts. The following budget information relates to Wright Ltd for next year. Activity Activity Cost Activity Cost Annual number pool (6) driver of activity cost drivers Operating machinery 660,000 Machine hours 110.000 Maintaining 80,000 Maintenance 1.600 machinery hour Setting-up machinery256, 000 Machinery 8,000 set-up Purchasing materials59,850 Purchase 450 order Controlling quality 104,500 Quality 5,500 inspection Total 1.160, 350 An order from a customer for 80.000 units of parts caused 14.500 hours of machining, 22 maintenance hours, 20 machinery set-ups, 35 purchase orders, and 12 quality inspections. The order used 50,000 of materials and 65.000 of direct labour. The cost driver rate per activity is (1 mark): Operating Maintaining Setting-up Purchasing Controlling machinery machinery machinery materials quality c) 6 50 18 50 18 Operating Maintaining Setting-up Purchasing Controlling machinery machinery machinery materials quality b) 7 40 11 80 16 Operating Maintaining Setting-up Purchasing Controlling machinery machinery machinery materials quality 32 133 19 d) 6 50 Operating Maintaining Setting up Purchasing Controlling machinery machinery machinery materials quality a) 8 30 13 15 1 points QUESTION 46 All of the following is a period cost EXCEPT (1 mark): Monthly depreciation of assembly line equipment Cost of a training session attended by the company's controller. urance on a company administration building d Salary of an accountant 1 points QUESTION 47 An unfavourable labour rate variance together with a favourable labour efficiency variance may be explained by (1 mark)? a. The employment of less well-trained staff than intended. b. Poor wage negotiation by the Human Resources manager. Improved production efficiencies. d. The employment of more highly skilled staff than budgeted. 1 points QUESTION 49 The standard cost of one unit of product includes 3 hours of direct labour at $11.50 per hour. Company X' labour rate (price) variance was $142 unfavourable. The efficiency variance was $506 unfavourable and 200 units were produced. The actual labour hours were (2 marks): 505 hours b. 523 hours C. 644 hours d. 492 hours 42/44 2 points QUESTION 50 Consider the following costs: Production supervisor's salary 34.000 Direct materials 27,000 Selling expenses Indirect materials 16.000 22.000 Depreciation of factory equipment 25.000 Direct labour 23.000 Utilities for factory 9000 Administrative expenses 21.000 What is the total amount of manufacturing overhead (2 marks)? 89,000 b. 140,000 C. 90,000 d. 68.000 2 points