Scenario

A manufacturing company has been producing and selling industrial product (cannot consumed by human/animal) to its customers in West Malaysia. The company owns only one factory which consists of 5 departments: Storage, Production, Maintenance, Quality Control and Warehouse. During the last few months, the company has been experiencing the rapid increase in manufacturing costs despite of constant in production output. The Management has decided to engage you and your group as a consultant to investigate the problem.

Required:

Based on your research, identify and describe the SOPs or method(s) that used to generate information to answer FOUR questions given above from your own department.

(24 marks)

Note:

1. If you are from Maintenance department, you just need to choose THREE questions.
2. Your SOPs/methods can be simplified in step-by-step or flowchart format.
3. Ensure that all your research finding must be related directly/indirectly to manufacturing.
4. You must write your name and department (in charged by you) on top of your answers that contributed by you in your final write up before submission.

STEP THREE: Group members contribution

Required:

1. Identify ONE (1) type of followings from your factory and how the concepts can be applied:

1. Direct material cost (3 marks)
2. Direct labor cost (3 marks)
3. Direct expense cost (3 marks)
4. Factory overhead cost (3 marks)

Note: your answer must be supported with cost accounting concept(s) as follow:

For example: Product Fried rice

Egg is part of raw maerials of fried rice. Egg is classified as direct material because. (use concept to support). Therefore, its cost will be called direct material cost.

2. Refer to the scenario, any problem occurs during the manufacturing process (from raw material to finished good) will have the severe impact on production cost.

Discuss the impact of FOUR(4) major problems that commonly occurred in you factory/industry.