Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

this is management accounting please do it in detail thank you :) PART A AdLine Berhad designs and produces walk-in wardrobes on a Just-in-Time (JIT)

this is management accounting please do it in detail thank you :) image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
PART A AdLine Berhad designs and produces walk-in wardrobes on a Just-in-Time (JIT) basis. The carpentry company allows customers to choose from several design options that can be customised to use different wood flooring forms: timber, laminated wood and engineered wood. When a customer orders a wardrobe with either laminated wood flooring or engineered wood flooring, it will be built into the customer's room within a month. But when a customer orders a wardrobe with timber flooring, the wardrobe will be completed within three months. The company uses a traditional job order costing system to allocate its manufacturing overhead. The cost will be allocated to each option based on the direct labour costs required. The approach is based on the assumption that the more expensive wardrobes with timber flooring would require more overhead costs because of its specialised labour. Continued.... The budgeted costs and order data of the three possible wardrobe options for the first six months of 2021 are presented as follows: Wardrobe, Laminated Flooring Wardrobe, Engineered Flooring Wardrobe, Timber Flooring Volume (orders) 80 15 7 Direct materials Flooring Panels boards and frames Glass and mirrors RM120 RM80 RM160 RM40 RM200 RM60 RM400 Direct labour (per order) Design time (RM12/hour) 70 hours 80 hours 100 hours Production time (RM20/hour) 90 hours 80 hours 140 hours Manufacturing Overhead Supervisory salaries Factory rent Equipment rent Utilities Insurance Information technology infrastructure Building maintenance Equipment maintenance RM 36,000 127,200 50,000 20,000 10,000 50,000 8,160 4,000 Required: a) Compute and interpret the predetermined manufacturing overhead rate for the first six months of 2021. (4 marks) b) What are the total manufacturing overhead costs to be allocated (assigned) to the three wardrobe options? (3 marks) c) Determine the total product cost for the three wardrobe options in the first six months of 2021. (6 marks) d) What is the expected total gross profit for the first six months for 2021? (2 marks) e) Explain what is production cost report and the FOUR steps to prepare the report

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions