Subject: Accounting

Question 4 Kimpal Sdn Bhd (KSB) manufactures specialty clothes for teenagers, the following data was extracted from KSB: Cutting Sewing Finishing Department Department Department Budgeted labour hours 20,000 18,000 10,000 Budgeted machine hours 11,200 9,300 25,000 Hourly wage rate RM9.70 RM9.30 RM9.00 Production overheads RM210,000 RM135,000 RM60,000 During April 2021, DSB worked on a special order, job no. ML12. Cost and production data for each order are shown as follows: Direct materials Silk 550 metres Cotton 600 metres Polyester 450 metres Buttons, beads RM7,000 Direct Labour: Cutting Department 750 hours Sewing Department 550 hours Finishing Department 500 hours Machine Hours spent in each department: Cutting Department 350 hours Sewing Department 200 hours Finishing Department 850 hours Additional information: During this months, 950 units of job no. ML12 were produced. Silk costs RM40 per metre, cotton costs RM35 per metre and polyester costs RM20 per metre. Basis of overhead absorption rate for Cutting and Sewing Department is direct labour hour, and Finishing Department is machine hour. Selling and distribution overheads are charged to the job based on 15% of the production cost. Profit is to be maintained at 20% on selling price. Required: (a) Compute overhead absorption rate (QAR) for each department (9 marks) (b) Calculate the following for job no. ML12: Prime cost (7 marks) (ii) The production cost (3.5 marks) (iii) Total cost (1.5 marks) (iv) Unit cost (2 marks) (v) Selling price per unit if the profit is to be maintained at 20% on total cost. (2 marks) Note: (a) Round your answers to TWO (2) decimal points (b) Show all your relevant working. (Total: 25 marks)