MGT 430 Saudi Electronic University Cost Accounting Questions
Question Description
Instructions
READ THEM CAREFULLY
The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.
Q 1 The accountant for Kadhim Inc. is preparing the budgets for operating department support service costs. Maintenance costs are allocated based on square feet, and cafeteria costs are allocated based on number of employees. The following data have been collected:
Support Departments Operating Departments
Maintenance Cafeteria Cutting Packaging
Direct costs SAR50,000 SAR45,000 SAR275,000 SAR300,000
Number of employees 15 10 150 250
Square feet 1,500 2,000 3,500 4,000
a-If the direct method is used, calculate maintenance costs allocated to the cutting department?
b-If the direct method is used, calculate the total cost (including allocations) for the
packaging department?
c-Assume you are working for the organization and are requested to allocate support
department costs. Describe how you would choose the best method?
( 2 marks)
Answer
Q 2 Khaleel Compagny produces three products A, B and C. During the year the joint costs of processing the coffee were SAR270,000. Production and sales value information were as follows:
Sales Value
Product Units at Split-Off Separable Costs Selling Price
A 300,000 SAR9 per unit SAR5.00 per unit SAR32 per unit
B 200,000 SAR8 per unit SAR3.00 per unit SAR30 per unit
C 400,000 SAR7 per unit SAR2.00 per unit SAR20 per unit
Chose one method to allocate joint costs and allocate the joint costs. (1 mark)
Answer
Q 3 In a recent accounting period, Ismail Company experienced a SAR30,000 unfavorable variance for variable production costs. Explain the meaning of an unfavorable variance. Suggest two possible (1 mark)
Answer
