1. The purchase and issue of Materials by Jishinde Ushinde Manufacturers for the month of March, 2015
March 1 Received 2000 units @sh.240 each
4 Received 1000 units @sh.260 each
9 Issued 800 units
15 Issued 1400 units
21 Received 1600 units @sh. 280 each
25 Issued 1000 units
28 Issued 800 units
An order for 2000 units at Sh.290 has been placed for delivery on April, 1
There was no opening inventory of the raw materials. You are required to prepare the stores ledger accounts when issues are priced, respectively, according to
- First – In – First – Out (FIFO)
- Last – In – First – Out (LIFO)
- Simple Average
- Weighted Average
- Replacement Cost
1. A company has three production departments and two service departments. The overhead analysis sheet provides the following totals of the overheads analyzed to production and service departments.
$
Production Department A 48,000
B 42,000
C 30,000
Service Departments 1 14,040
2 18,000
152,040
The expenses of the service departments are apportioned as follows:
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PRODUCTION DEPARTMENTS
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SERVICE DEPARTMENTS
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A
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B
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C
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1
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2
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SERVICE DEPARTMENT 1
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20%
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40%
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30%
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-
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10%
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SERVICE DEPARTMENT 2
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40%
|
20%
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20%
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20%
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-
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|
|
|
|
|
|
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Allocate the Service Department costs to Production Departments using
- Direct Method
- Specified Order of Distribution Method
- Repeated Distribution Method
- Simultaneous Equation Metho
2. The Italian furniture Center employs two carpenters Leo and Romana. They are paid a basic rate of 1000 per hour. Overtime is paid at double the normal rate. The normal working week is forty hours. During the week Leo and Romana were assigned 30 chairs and 50 stools respectively. The time allowed is two hours for each chair and one hour for each stool.
Leo worked 45 hours including overtime to complete the chairs assigned to him while Romana completed the assigned stools in 38 hours but worked full week (i.e. worked 2 hours on another task)
On inspection at the end of the week five chairs and ten stools were found to be defective. The carpenters are not penalized for defective units.
Required
The labour cost per unit of good production under Halsey Scheme, Halsey weir Scheme and Rowan Scheme
2. A manufacturing company produces a single product. During the year ended 31 December 2011, 10,000 units were produced and sold. There was no opening and closing inventory. All the 10,000 units were sold at $200 each.
The costs of manufacturing in $ during the year were shown as follows:
Costs $ $$$
$$
Direct Materials 600,000
Direct Labour 200,000
Variable Manufacturing Overheads 40,000
Fixed Manufacturing Overheads 300,000
Variable Selling Overheads 187,500
Fixed Selling and Administrative Overheads 250,000
Required
Prepare operating Statement using Marginal and Absorption Costing
SCENARIO 2
Use the previous data except that
there was closing inventory of 2,000 units, i.e.
only 8,000 units were sold during the year and as
a corollary the variable selling overheads would
only be $150,000 ($187,500 x 8,000/10,000).
SCENARIO 3
Fixed Overhead in Closing Inventory Less Than Opening Inventory
Continue with previous data (with closing inventory of 2,000 units as
at 31 December 2011. During the year ended 31 December 2012,
9,000 units were produced and the costs of manufacturing were:
Costs
Direct Materials $70 per unit
Direct Labour $25 per unit
Variable Manufacturing Overheads $5 per unit
Variable Selling Overheads $16 per unit
Fixed Manufacturing Overheads $261,000
Fixed Selling and Administrative Overheads $280,000
10,000 units were sold at $210 each.