ACCT 301 SEU How Job Costing Is Used Service Sectors & Manufacturing Sectors Questions

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Textbook

Eldenburg, L. G., & Wolcott, S. K. (2011). Cost management: Measuring, monitoring, and motivating performance (2nd ed.). Hoboken, NJ: John Wiley & Sons, Inc. ISBN-13: 978-0470-76942-3.

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College of Administration and Finance Sciences
Assignment (2)
Deadline: Saturday 09/04/2022 @ 23:59
Course Name: Cost Accounting
Student’s Name:
Course Code: ACCT 301
Student’s ID Number:
Semester: 2nd
CRN:
Academic Year: 1443 H
For Instructor’s Use only
Instructor’s Name:
Students’ Grade:
/10
Level of Marks: High/Middle/Low
Instructions – PLEASE 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 answers 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.
College of Administration and Finance Sciences
Assignment Question(s):
(Marks 10)
Q1. Explain how job costing is used in service sectors and manufacturing sectors? Provide
examples by citing one job costing example of the service sector and one example of the
manufacturing sector of a Saudi company to support your answers.
(CH 5, 2 Marks)
Answer:
Q2. Axel Ltd. uses a process costing system for its sole processing department. There were 24,000
units in beginning WIP inventory for March and 216,000 units were started in March. The
beginning WIP units were 75% complete and the 19,500 units in ending WIP were 60%
complete. All materials are added at the start of processing.
(CH 6, 3 Marks)
Required:
a) Compute the no. of units started & completed.
b) Compute the EUP for DM and CC using FIFO and WA methods.
c) Calculate total manufacturing cost/EUP under both methods, if the following details are
available:
FIFO
WA
Direct Material Cost
SAR 700,000
SAR 910,000
Conversion Cost
SAR 920,000
SAR 1,210,000
Answer:
College of Administration and Finance Sciences
Q 3 DD Company has two departments, Dept. A and Dept. You are provided the following costs
for five activities that occur at the manufacturing plant every month:
(CH 7, 2 Marks)
Activity
Material handling
Supervision of direct labor
Janitorial and cleaning
Machining
Total Costs (SAR)
315,000
180,000
250,000
350,000
Total costs
Total number of units of Cost Driver
450,000 parts
110 employees
5,500 hours
8,500 machine hours
1,095,000
The above activities are used by the two departments as follows:
Material handling
Supervision of direct labor
Time spent cleaning
Number of machine hours
Department A
220,000 parts
65 employees
2,500 hours
6,000 machine hours
Department B
230,000 parts
45 employees
3,000 hours
2,500 machine hours
a. How much of the material handling cost will be allocated to Department A?
b. What is the ABC allocation rate for supervision of direct labor?
Answer:
Q 4. T&T produces product ‘X’ as a part of its main product. Each year, the company produces
75,000 units of product ‘X’. The costs of production are mentioned below. An outside supplier
has offered to deliver 75,000 units of product ‘X’ annually at a cost of $7.35 per unit. A fixed
production cost of $ 120,000 is unavoidable for product ‘X’. Should T&T Co. make or buy
product ‘X’?
College of Administration and Finance Sciences
(CH 4, 2 Marks)
The production costs per unit for manufacturing a unit of product B are:
Production Cost
Amount ($)
Direct Materials
2.55
Direct Labor
1.95
Variable Manufacturing Overhead
1.20
Answers:
Q5. “ABC is a costing method that allocates overhead and indirect costs to related products and
services.” Comment on this statement and examine how ABC is used in the manufacturing sector
with a suitable example.
Answer:
(CH 7, 1 Mark)

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Tags:
cost accounting

manufacturing sectors

Cost management

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