ACCO 330 - Midterm sol - W08

ACCO 330 - Midterm sol - W08 - Solution ACCO 330 Midterm...

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Unformatted text preview: Solution ACCO 330 Midterm exam Winter 2008 Answer Key Solution MCQ Question 1 (30 marks) 1. D (1 mark) 2. E (1 mark) 3. B (1 mark) 4. B (1 mark) 5. D (1 mark) 6. E (1 mark) 7. A (1 mark) 8. E (1 mark) 9. C (1 mark) 10. D (1 mark) 11. B (1 mark) 12. A (1 mark) 13. B (1 mark) 14. C (1 mark) 15. B (1 mark) 16. A (1 mark) 17. C (1 mark) 18. B (1.5 marks) 19. A(1.5 marks) 20. D (2 marks) 21. A (2 marks) 22D (2 marks) 23. C (2 marks) 24D (2 marks) Solution ACCO 330 Midterm exam Winter 2008 Question 2 21.1 Direct Method Producin De artments Machining Assembly Service De artments Maintenance Personnel To Utilities From Utilities 1 _ 1 Maintenance - — l Personnel — - 212 Step Method 333/683 350/683 8/9 1/9 147/167 20/167 Service De artments Producin De artments Maintenance Personnel Machining Assembly Utilities l Utilities 12/700 5/700 333/700 350/700 Maintenance — 1/46 40/46 5/46 Personnel l — l — - l 147/167 J 20/167 (7.5 marks) b. Step Method Utilities Maintenance Personnel Machining Assembly Budgeted costs $800,000 $650,000 $400,000 $1 ,230,000 $370,000 Allocate Service Department Costs to Production Departments First Step Utilities % — 12/700 5/700 333/700 350/700 Amount (800,000) $13,714.29 $5,714.29 $380,571.42 $400,000 Second Step Maintenance % — - 1/46 40/46 5/46 Amount ($663,714.29) $14,428.57 $577,142.86 $72,142.86 Third Step Personnel % — — - 147/167 20/167 Amount ($420,142.86) $369,826.35 $50,316.51 Totals Costs — $2,557,540.63 $892,459.37 / Activity 500,000 MH 60,000 DLH Rate $5.115 $14,874 per MH per DLH (7.5 marks) Solution ACCO 330 Midterm exam Winter 2008 Question 3 a. Total units to account for: Beginning inventory Units started during current period Units to account for Accounted for as follows: Units completed from beginning Units started and completed Units in ending WIP inventory Units accounted for Equivalent units of production: Completed from Beginning: 3,000 x (100% -100%) 3,000 x (100% — 0%) 3,000 x (100% — 0%) 3,000 x ([70%—30%] / [70% - 20%]) 3,000 x (100% — 30%) Units started and completed Ending inventory: 2,000 x 100% 2,000 x 100% 2,000 x 0% 2,000 x ([65%—20%] / [70% — 20%]) 2,000 x 65% Equivalent units of production Current period costs Equivalent units Cost per equivalent unit 38,000 2,000 3,000 38,000 2,000 (15 marks) 3,000 M99 43,000 3,000 38,000 £1992 43,000 Z DL OH 3,000 2,400 2,100 38,000 38,000 38,000 -0- 1,800 1,300 41 ,000 42.200 41 ,400 Z DL OH 21,320 18,146 20,286 41 ,000 42fl0 41,400 $ 0.52 $ 0.43 $ 0.49 Solution ACCO 330 Midterm exam Winter 2008 Question 4 a. (i). To record the sale of normal spoilage attributable to Job Y12 Cash 500 Work-in—process —Job Y12 500 (20 marks) (j). To record the normal and abnormal spoilages incurred in Job D20 300 100 Factory Overhead Loss from Abnormal Spoilage Work—in—process- Job D20 400 (k). To record the scrap sold attributable to a specific Job E33 Cash 60 Work—in—process -J ob E33 60 (1). To record the scrap sold common to all jobs Cash 110 Factory Overhead 110 b. . Job Cost Sheets For the year ended April 30th, 2004 Job Y12 Job D20 Job E33 Beg WIP 21,000 —0— —0- DM 46,000 84,000 44,000 DL 12,220 8,060 3,640 OH Applied * (A)9,776 03)6,448 (C)2,912 Normal Spoilage (D)-0— (E)(300) (F)—0- Abnormal Spoilage (G)-0— (H) (100) (I)—0- Salvage /Scrap (JM 5001 1 31—0- (L); 60) Total 88,496 98,108 50,492 * [12,220/20 X l6**]; [8,060/20 X 16]; and [3640/20 X 16] ** Predetermined OH rate = 256,000 / 16,000 = $16 per DLH (6 marks) (5 marks) Total 21,000 174,000 23,920 19,136 (300) (100) (560) 237 096 Solution ACCO 330 Midterm exam Winter 2008 Actual OH Indirect Materials $8,000 Indirect Labor 5,000. Depreciation 4,400 Utility 2,600 Other 3,200 Normal Spoilage 300 Scra 1 10 Total Actual OH 23,390 Less Applied OH 19,136 (from requirement (3)) Under- applied OH $4,254(3 marks) d. Current % Under—applied AEElied OH OH WIP —D20 $6,448 33.696% X 4,254 WIP—E33 $2,912 15.217% X 4,254 FG—Y12 $9,776 51.087% X 4,254 Total $19,136 100% The Journal entry to close out the factory overhead as follows: Work-in—process—DZO 1,433.43 Work in process—E33 647.33 Finished goods-YIZ 2,173.24 Factory overhead OR Factory overhead applied 19,136.00 Work—in—process—DZO 1,433.43 Work in process-E33 647.33 Finished goods-YIZ 2,173.24 Factory overhead (3 marks) e. Sales 148,000 Less CGS (108,000) Administrative Salaries (12,000) Depreciation (3,400) Advertising (12,000) Abnormal Loss ( 100) Net Income $12,500 (3 marks) Share 1,433 .43 647.33 2,173.24 §4,254.00 4,254 23,390 Solution ACCO 330 Midterm exam Winter 2008 Question 5 (20 marks) Total units to account for: Beginning inventory 3,000 Units transferred in during current period 45,000 Units to account for 48,000 Accounted for as follows: Units completed and transferred out 40,000 Units spoiled 4,000 (70%) Units in ending WIP inventory 4,000 120%) Units accounted for 48,000 # of units survived the inspection for spoilage (48,000 — 4,000 — 4,000) 40,000 Normal spoilage percentage 5% Normal spoiled units 2,000 Abnormal spoilage = 4,000 — 2,000 = 2,000 units . # of units inspected for rework 41,500 Less the number of physical units [48,000 w 4,000 -4,000] 140,000) Rework “effort” units 1,500 # of units survived the inspection for rework 40,000 Normal rework percentage 2% Normal rework “effort” units 8 0 Abnormal rework = 1,500 — 800 = 700 “effort” units Equivalent units of production: Transferred In Material Conversion Completed (40,000 X 100% all) 40,000 40,000 40,000 Normal spoilage T1 (2,000 X 100%) 2,000 DM (2,000 X 0%) —0— CC (2,000 X 70%) 1,400 Abnormal spoilage TI (2,000 X 100%) 2,000 DM (2,000 X 0%) —0— CC (2,000 X 70%) 1,400 Normal Rework T1 (800 X 0%) —0- DM (800 X 100%) 800 CC (800 X 25%) 200 Abnormal Rework T1 (700 X 0%) -0— DM (700 X 100%) 700 CC (700 X 25%) 175 Ending WIP TI (4,000 X 100%) 4,000 DM (4,000 X 0%) —0— CC (4,000 X 20%) 800 Total equivalent units 48,000 41 ,500 43,975 Transferred In Material Conversion Total Solution ACCO 330 Midterm exam Winter 2008 Beginning WIP $70,000.00 $6,495.00 Current costs $1,130,000.00 $96,840.00 Total $1,200,000.00 $103,335.00 Equivalent units 48,000 41,500 Cost per equivalent unit $ 25.00 . Cost of Goods Transferred out from Assembly Completed (40,000 X 33.14) $1,325,600 Add Normal Spoilage * 47,910 (see below) Add Normal Rework** 3,122 (see below) Total costs 1,376,632 * Normal Spoilage T1 (2,000X 25) 50,000 CC (1,400 X 5.65) 7,910 Salva e value 2 000 X 5 10 000 Total 47,910 ** Normal Rework DM (800X 2.49) 1,992 CC_(_2_00 X 5.6_5_)_ _1,130 Total $1; $11,868.75 236,590.00 $248,458.75 43,975 2 49 5.65 $88,363.75 $1,463,430.00 $1,551,793.75 33.14 ...
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