Question 21 (25 marks) (CLO 1) The following balances were extracted from the books of a Manufacturing company at the end of December 2021 Details $ Office expenses 650,000 Production foremen salaries 1,200,000 Wages of production workers 3,800,000 Materials used to make products 5,625,000 Depreciation of office machinery 200,000 Warehouse supervisors salaries 500,000 Depreciation of factory machinery 600,000 License fee paid to manufacture products 300,000 Wages of truck drivers 750,000 Salesmen salaries 3,600,000 Electricity (see notes) 600,000 Salaries of the administrative staff 4,000,000 Carriage outwards 240,000 Insurance (see notes) 450,000 Janitorial factory wages 250,000 Notes Apportion the following charges as indicated below Details Factory Administration Distribution Selling Electricity 50 30 10 10 Insurance 40 20 15 25 As the Cost Accountant you are required to classify the costs into the following categories for management decisions (a) Prime Costs (4 marks) (b) Factory overheads (3 5 marks) (c) Production costs (2 marks) (d) Conversion costs (2 5 marks) (e) Administrative costs (3 5 marks) (f) Selling costs (2 5 marks) (g) Distribution costs (3 5 marks) (h) Total costs (3 5 marks) Question 22 (CLO 3) 25 marks ABC Producers is a manufacturing company that budgeted to produce 12,000 units For the month of December, the company had opening stock of 2,500 units and closing stock of 4,500 units The following information was taken from the companys books for the month of December 2012 Details $ Direct material cost per unit 200 Direct labour cost per unit 150 Variable overhead cost per unit 50 Fixed production overhead cost 650,000 Sales price per unit 600 During December 2012 the company produced 15,000 units and 13,000 units were sold Administrative and selling overheads amounted to $75,000 and $90,000 respectively Required a) Prepare profit statement using variable marginal costing techniques for December 2012 (12 marks) b) Prepare profit statement using absorption costing techniques for the month of December 2012 (13 marks)

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Question 21 (25 marks) (CLO 1) The following balances were extracted from the books of a Manufacturing company at the end of December 2021. Details

Question 21 (25 marks) (CLO 1)

The following balances were extracted from the books of a Manufacturing company at the end of December 2021.

Details

Office expenses

650,000

Production foremen salaries

1,200,000

Wages of production workers

3,800,000

Materials used to make products

5,625,000

Depreciation of office machinery

200,000

Warehouse supervisors salaries

500,000

Depreciation of factory machinery

600,000

License fee paid to manufacture products

300,000

Wages of truck drivers

750,000

Salesmen salaries

3,600,000

Electricity (see notes)

600,000

Salaries of the administrative staff

4,000,000

Carriage outwards

240,000

Insurance (see notes)

450,000

Janitorial factory wages

250,000

Notes: Apportion the following charges as indicated below:

Details

Factory

Administration

Distribution

Selling

Electricity

50%

30%

10%

Insurance

40%

20%

15%

25%

As the Cost Accountant you are required to classify the costs into the following categories for management decisions.

(a) Prime Costs (4 marks)

(b) Factory overheads (3.5 marks)

(d) Conversion costs (2.5 marks)

(e) Administrative costs (3.5 marks)

(f) Selling costs (2.5 marks)

(g) Distribution costs (3.5 marks)

(h) Total costs (3.5 marks)

Question 22 (CLO 3) 25 marks

ABC Producers is a manufacturing company that budgeted to produce 12,000 units. For the month of December, the company had opening stock of 2,500 units and closing stock of 4,500 units. The following information was taken from the companys books for the month of December 2012:

Details

Direct material cost per unit

200

Direct labour cost per unit

150

Variable overhead cost per unit

Fixed production overhead cost

650,000

Sales price per unit

600

During December 2012 the company produced 15,000 units and 13,000 units were sold. Administrative and selling overheads amounted to $75,000 and $90,000 respectively.

Required:

a) Prepare profit statement using variable/marginal costing techniques for December 2012. (12 marks)

b) Prepare profit statement using absorption costing techniques for the month of December 2012. (13 marks)