Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Financial Accounting Expert

Establish and maintain accounting info systems and Provide management accounting information Assignment -

Assignment 1 - Case Studies

Case Study 1 - Review the case study information below and complete the steps mentioned in the Assessment Task.

Exotica, a kitchen appliances business wants to convert their paper-based accounting system over to an electronic system, as they believe it will be more efficient in the long run to manage the accounts. They want whatever new system you recommend to them to be compliant with all Australian requirements for small businesses.

Exotica has sixteen full-time and seven part-time staff, but only three members of staff will have/need access to the financial system. These will be the business manager Jodie, the accounts manager Rod and the payroll manager Helen. They want software that is a single purchase with no ongoing license fees, and plan to keep using if for the next three to five years, while the organisation continues to grow. They are anticipating that within five years they will have over 50 full-time staff, and that at least six staff will require access to the financial system by then.

The company has just upgraded its computers, and has three new desktop PCs which will be used by the finances staff. They are current (for 2015) specification machines with i5 CPUs and 4Gb RAM each, and all have Windows 8 Professional and Norton's 360 installed, with the professional version of Microsoft Office Small Business as well. Other staff will use their machines at various times, so it is important that the software requires a login to access data, and that data stored by the software cannot be accessed in any other way.

They do not have any backup software or mechanisms in place, as they have not used computers within the business at all until now. All financial matters have been handled in physical ledgers, etc. They would prefer to now have no paper-based records at all and want to be able to enter all of their existing current data to create opening balances and then throw out their old paper-based records.

Procedure -

Using this case study information provided, you need to complete the following steps:

1. Create a spreadsheet containing:

a. A prioritised list of objectives to meet system and record requirements of the organisation.

b. Identified security requirements to maintain system integrity.

c. Identified technological capabilities of the organisation.

2. Use the spreadsheet to clearly compare at least two pieces of publicly available software, measured against the prioritised system requirements, security requirements and capabilities of the existing technology.

3. Prepare a written report, that reflects the information on the spreadsheet and includes information under the following headings:

a. Software (a brief summary of each piece of software you have compared in the spreadsheet)

b. Preferred Option (a clear identification of your preferred option, including a cost-benefit analysis of the different types of software available)

c. Security (a brief description of how the identified software satisfies security requirements)

d. Reporting (a brief description of the reporting capabilities of the identified software, including description of types of reports that may be generated)

e. Improvements (identify any improvements to the system that could be implemented with improved or new technology within the organisation).

4. Give your written feedback after using these two accounting information system. Your feedback must include the following:

a. a brief biography or description of your experience in using these softwares (50 words maximum)

b. clear agreement that all system requirements and capabilities are being met by the identified software system

c. clear confirmation that the identified system is suitable to meet the identified needs of the case study.

Specifications -

You must provide:

  • a completed spreadsheet, as outlined above in Step 1 and Step 2
  • a completed written report, as outlined above in Step 3
  • Written supporting feedback, as outlined above in Step 4.

Your assessor will be looking for:

  • evidence that you analysed and identified the needs of the case study organisation
  • evidence that you have identified appropriate software systems, and have compared them
  • evidence that you can setup a spreadsheet to assist with analysis of the software systems.

Case Study 2: For this task you are required to implement an electronic asset register, using spreadsheet software for an organisation, as it transitions from a paper-based system. You will need to transfer existing data into the new system, develop implementation and usage documentation, establish contingency plans, establish training systems to support implementation, consult with selected users, and make available system documentation for all users.

Procedure -

Using this case study information provided, you need to complete the following steps.

Create a spreadsheet using spreadsheet creation software in the format as recommended by the ATO (see example with this assessment task).

Transfer all existing data from asset cards to the new spreadsheet, and confirm that the end of year depreciation amount is the same as identified in existing records.

Prepare an Implementation Plan, with the following key sections.

a. Implementation Strategy: for use of the spreadsheet, outlining how it can be regularly updated and checked for accuracy, how backups will be managed and how integrity of the system will be maintained.

b. Contingency Approaches: plans outlining possible or anticipated implementation problems, and how they can be managed.

c. Usage Documentation: a clear, step-by-step description outlining how the spreadsheet is to be accessed, updated and have new assets added to the spreadsheet (this may be in the form of a policy and procedure document).

d. Availability: a description of how the usage documentation will be made available to users within the organisation.

e. Training: a description of a schedule and program to train users of the system through the implementation phase.

Specifications -

You must provide:

  • a completed Implementation Plan, as outlined above
  • a completed spreadsheet, as outlined above

Your assessor will be looking for:

  • evidence that you correctly interpreted and incorporated the information provided in the case study
  • evidence that you have developed a suitable implementation strategy.

Case study 3: Asset information

Assets currently kept track of in a hand-written register:

  • Motor vehicle (Ford Sedan), purchased 1/07/2014 for $40000 and written down on the 30/06/2015 to be worth $35000.
  • Computer, purchased 1/07/2014 for $2400, and written down on the 30/06/2015 to be worth $1800.
  • Photocopier, purchased 1/07/2014 for $4000, and written down on the 30/06/2015 to be worth $3200.
  • TV purchased 1/07/2014 for $1800, and written down on the 30/06/2015 to be worth $1620.
  • Carpets purchased 1/07/2014 for $6000, and written down on the 30/06/2015 to be worth $5250.

Additionally, a fire extinguisher was purchased on the 1/09/2015 at a price of $800.

Depreciation rates (ATO)

Depreciating asset

Effective life in years

Carpets


- in commercial office buildings

8

- in ten-pin bowling centres

4

Computers


- generally

4

- laptops

3

Curtains and drapes

6

Fire extinguishers

15

Hot water installations for commercial office buildings (excluding commercial boilers and piping)

15

Lawn mower


- motor

6 2/3

- self propelled

5

Library (professional)

10

Motor vehicles


- cars generally

8

- hire and travellers' cars

5

- taxis

4

- motor cycles and scooters

6 2/3

Office machines and equipment


- photocopying machines

5

Point of sale assets


- cash registers, stand-alone type

10

Power tools (hand operated)

5

Television receivers


- generally

10

Tools (loose)

5

Vacuum cleaners (electric)

10

Use the prime cost method to calculate depreciations for the motor vehicle, computer and copier.

Assignment 2 -

Assessment Task 1: Project

QUESTION 1 - A business has variable costs of $10 per unit. The selling price is $40 per unit. Fixed costs amount to $300,000. The manager of the business has set a net profit objective of $42,000 after tax. The income tax rate is 30%.

REQUIRED:

(i) Calculate the break-even point sales revenue.

(ii) Calculate the break-even point sales units to achieve an after tax profit of $42,000.

(iii) Calculate the break-even point sales dollars to achieve a before tax profit of 15% on sales revenue.

QUESTION 2 - Gillan Ltd uses a perpetual inventory system. The unit cost of inventory is assigned using the First-In, First-Out method. During June 2015 the company had the following transactions for an item of material:

June  1

Balance

240 units @ $6.00

$  1,440





5

Purchased on credit

160 units @ $5.50

880

10

Issued 40 units to Job 60



15

Issued 220 units to Job 61



20

Purchased on credit

260 units @ $6.00

1,560

22

Issued 100 units to Job 62



25

Issued 200 units to Job 63



29

Returned 10 units to the supplier purchased on the 20 June

REQUIRED:

(a) Prepare an inventory ledger card (stock card) to record the above.

(b) Prepare a general journal entry to record the total issues for June.

(c) Prepare a general journal entry to record the return to the supplier of 10 units purchased on 20 June.

QUESTION 3 - PART A - Factory overhead cost and production data for a firm for a year were as follows:


Variable Cost

Fixed Cost

Machine Hours


$

$


Actual

90,000

205,000

20,000

Budget

95,000

190,000

19,000

Factory overhead is recovered from production using machine hours as the cost driver.

REQUIRED:

a) Calculate the factory overhead recovery rate.

b) Determine the amount of over or under-applied overhead. Your answer must clearly state whether the calculated amount is over or under-applied.

PART B - Huxstep Ltd is developing factory overhead rates for the coming year. Budgeted overhead costs for the five factory departments are as follows:


Cost ($)

Cost Driver

Cutting

66,750

Machine hours

Assembly

49,500

Direct labour hours

Maintenance

33,750

Repair hours

Factory office

43,500

Square metres

Personnel

31,500

No. of employees

Total

$225,000


Estimated operating statistics for this year are:


Repair hours

Square metres

No. of employees

Machine hours

Direct labour hours

Producing:






Cutting

9,000

2,000

12

5,895

10,710

Assembly

6,000

3,000

16


26,790

Support:






Maintenance

400

700

3



Factory office

1,600

100

2



Personnel

1,000

200

3



Total

18,000

6,000

36

5,895

37,500

REQUIRED:

a) Calculate a plant-wide overhead rate based on direct labour hours.

b) Calculate departmental overhead rates assuming the support departments' costs are allocated using the direct method.

QUESTION 4 - PART A - Condamine Ltd produces a single product that sells for $80 per unit. Variable costs are $60 per unit. Fixed costs amount to $142,500.

REQUIRED:

(i) Calculate the break-even point in units.

(ii) If the business is to achieve a profit before tax of $50,000, how many units must be sold?

(iii) Given a tax rate of 30%, how many units must be sold to earn a profit of $42,000 after tax?

PART B - Which of the following do you believe is the best response?

i. A business has a unit contribution margin of $10 and break-even sales units of 8,000. What is the net profit if 12,000 units are sold?

(a) $40,000

(b) $80,000

(c) $120,000

(d) None of the above

ii. A business has a 25% margin of safety. This means that:

(a) Sales are 25% above the break-even volume,

(b) Net profit is 25% of sales.

(c) If sales fall by 25%, net profit will be nil.

(d) The contribution margin is 25% of sales.

QUESTIONS 5 - PART A - Bulloo Ltd recycles water from its production operations. The cost of treating the waste water is considered a semi-variable cost. Records of litres of water recycled and total treatment costs incurred over the past six months are as follows:

Month

Litres Recycled

Cost ( $ )

December

175,000

11,900

January

160,000

11,600

February

200,000

12,800

March

230,000

14,000

April

220,000

13,500

May

240,000

14,000

REQUIRED:

(a) Using the high-low method, calculate:

(i) The variable cost per litre.

(ii) Total fixed cost per month.

(b) What would be the expected total cost for a month when 225,000 litres are recycled?

PART B - Clarence Ord Ltd uses a perpetual inventory system. Inventory on hand at 1 July 2015 of lubricating oil used on machinery in the factory was 50 litres @ $8.10 per litre. During July the following transactions occurred:

July 3: Purchased 150 litres @ $8.30 per litre

July 11: Issued 60 litres

REQUIRED:

(i) Assuming the weighted average inventory costing method is used, calculate the total cost of the issue on 11 July.

(ii) Using the first-in, first-out inventory costing method, prepare a general journal entry to record the issue on 11 July.

QUESTION 6 - Payroll details for Gascoyne (NSW) Pty Ltd for September 2015 are as follows:

Factory:


Wages at ordinary hourly rates

25,992

Wages for overtime (time and one-half)

2,916

Salary (Supervisor)

4,835

Annual leave paid

1,607

Administration wages and salaries

16,350

Total gross

51,700

PAYG tax withholding

11,260

Medical fund deductions

1,200

i. The company reduces the appropriate provision for any leave paid.

ii. Analysis of time sheets shows 1,290 hours chargeable to jobs for the month. Factory overtime premiums are not chargeable to jobs. All factory wage employees are paid $18 per hour for ordinary time.

iii. The company's superannuation guarantee liability for the month is $4,550.

iv. Workers' compensation insurance of $18,600 was paid on 1 August 2015 for the year.

v. There were no accrued wages and salaries at 1 September.

REQUIRED:

(a) Prepare entries in general journal form to record the gross wages and salaries and payment of net pays for September.

(b) (i) Calculate direct and indirect labour cost for the month. Show all workings.

(ii) Prepare the general journal entry to account for the factory pays as direct and indirect labour.

(c) Prepare entries in general journal form to record the incurrence of the other labour related costs for September.

QUESTION 7 - PART A - Factory overhead cost and production data for Barwon Bogan & Co Ltd for the year are as follows:


Actual

Budget

Variable Cost

$92,800

$88,500

Fixed Cost

$160,000

$159,000

Machine Hours

16,000

15,000

A predetermined factory overhead rate based on machine hours is used to recover overhead costs.

REQUIRED:

(a) (i) Calculate the amount of over or under-applied overhead.

(ii) Assuming the amount calculated above in (a) (i) is of minor value (immaterial), prepare the general journal entry to dispose of this variance.

PART B - Alice & Katherine Pty Ltd is developing factory overhead rates for the coming year. Overhead costs budgeted for the four factory departments are as follows:


Cost ($)

Cost Driver

Brewing

49,500

Direct labour hours

Bottling

71,920

Machine hours

Maintenance

28,700

?

Factory store

36,880

?

Total

$187,000


Estimated operating statistics for the current year are:


Repair hours

Material Requisitions

Machine hours

Direct labour hours

Producing:





Brewing

2,000

1,000

2,500

12,500

Bottling

5,000

600

8,500

9,500

Support:





Maintenance

200

200



Factory store

800

200



Total

8,000

2,000

11,000

22,000

REQUIRED:

(a) Calculate a plant-wide overhead rate based on direct labour hours.

(b) Calculate departmental overhead rates assuming the support departments' costs are allocated using the direct method.

QUESTION 8 - The following information has been prepared from the accounting records of Doubting Ltd for the six months to 30 June 2015. The business uses a periodic inventory system.

Accounts receivable:

$

Balance 01/01/2015

178,300

Sales

1,846,500

Inventories 01/01/2015:


Raw Materials

95,940

Factory Supplies

8,440

Finished Goods

174,690

Work in Process

28,650

Factory insurances:


Prepaid 01/01/2015

2,920

Annual Premium paid 01/04/2015

12,360

Factory Plant & Equipment:


At cost 01/01/2015

343,800

Accumulated Depreciation 01/01/2015

154,710

Depreciation - Straight-line @ 10% p.a.

?

Accounts payable:


Balance 01/01/2015

45,180

Purchases 

- Raw materials

442,230


- Factory supplies

18,620


- Finished goods

38,730

Payments

317,840

Freight Inwards:


Raw materials

15,450

Factory supplies

1,790

Freight outwards

50,060

Wages and salaries:


Direct Labour

154,680

Indirect Labour

78,030

Factory Maintenance

11,430

Factory Lighting and Power:


Accrued 01/01/2015

4,110

Payments

16,750



Other adjustments as at 30 June 2015:

$

Inventories

- Raw Materials

102,660


- Factory Supplies

9,070


- Finished Goods

171,890


- Work In Process

37,220

Annual Leave accrued - Factory

16,320

REQUIRED:

Prepare the following statements (appropriately classified) for the six-months ended 30 June 2015:

(a) Manufacturing statement and

(b) Trading statement.

Assessment Task 2 - Portfolio

1. Why is a cost referred to as variable if it remains constant per unit for all volume levels within the relevant range?

2. The high-low method of analysing mixed costs uses only two observation points: the high and the low points of activity. Are these always the best points for prediction purposes? Why or why not?

3. Why are some material and labour costs that should, in theory, be considered direct costs instead accounted for as indirect costs?

4. Discuss the reasons a company would use a predetermined overhead rate rather than apply actual overhead to products or services?

5. Why can it be said that the cost of goods manufactured schedule shows the flow of production costs in a manufacturing company?

6. Why are departmental overhead rates more useful for managerial decision making than plant wide rates? Similarly why are separate variable and fixed rates more useful than total rates?

7. Match the following lettered terms on the left with the appropriate numbered description on the right.

a. Budgeted cost

1. An expense or loss

b. Direct cost

2. A cost that remains constant on a Per unit basis

c. Distribution cost

3. A cost associated with a specific Cost object

d. Expired cost

4. Direct material, direct labour and Manufacturing overhead

e. Fixed cost

5. Product cost

f. Inventoriable cost

6. A cost that varies inversely on a  per-unit basis with changes in  activity

g. Period cost manufacturing overhead

7. A cost primarily associated with the passage of time rather than production activity

h. Product cost

8. An expected future cost

i. Variable cost

9. A cost of transporting a product

8. What production conditions are necessary for a company to use job order costing?

9. Describe the following: Financial Accounting and Cost and Management Accounting.

10. How can contribution margin be used to calculate break-even point in both in units and dollars?

11. A company is in the 40 percent tax bracket. Why is desired profit after tax divided by 60 percent to determine the needed before-tax profit amount?

12. How are BEP and margin of safety integrally related?

13. What are the purposes of a break-even chart?

14. Outline the basic budgeting process

15. The projected sales, in units, for Einstein Inc. by month for the first four months were:

January 8,000

February 12,000

March 16,000

April 19,200

Inventory of finished goods on December 31 was 6,400 units. The company desires to have an ending inventory each month equal to one-half of next month's estimated sales. Determine the company's production requirements for each month of the first quarter.

16. SLB Co wishes to sell 14,000 units of its product, which has a variable cost of $15 to make and sell. Fixed costs are $47,000 and the required profit is $23,000. What is the required sales price per unit?

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M93112014
  • Price:- $80

Priced at Now at $80, Verified Solution

Have any Question? 


Related Questions in Financial Accounting

Comprehensive problem - lou barlow a divisional manager for

Comprehensive Problem - Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five-year period. His annual pay raises are determined by his division's ...

Lease classification considering firm guidance issues

Lease Classification, Considering Firm Guidance (Issues Memo) Facts: Tech Startup Inc. ("Lessee") is entering into a contract with Developer Inc. ("Landlord") to rent Landlord's newly constructed office building located ...

Scenario assume that a manufacturing company usually pays a

Scenario: Assume that a manufacturing company usually pays a waste company (by the pound to haul away manufacturing waste. Recently, a landfill gas company offered to buy a small portion of the waste for cash, saving the ...

The ipl just signed sachin to a contract consisting of

The IPL just signed Sachin to a contract consisting of eight, end-of-year payments worth $9 million each, with the first payment precisely one year from today. On the other hand, Dhoni recent deal calls for six annual pa ...

Establish and maintain accounting info systems and provide

Establish and maintain accounting info systems and Provide management accounting information Assignment - Assignment 1 - Case Studies Case Study 1 - Review the case study information below and complete the steps mentione ...

Supply and demand graphto complete this assignment address

Supply and Demand Graph To complete this assignment, address the following requests: 1. Based on the information from the US Energy Information Administration, create the supply and demand graph in the space below. This ...

Assessment task 1question no 1assessment taskbilby cos

Assessment Task 1 Question no. 1 Assessment Task: Bilby Co's income statement for the year ended 31 December 2015 and statements of financial position at 31 December 2014 and 31 December 2015 were as follows: Bilby co's ...

Corporate accounting assignment -assessment task -select

Corporate Accounting Assignment - Assessment task - Select two public limited companies listed on the Australian Securities Exchange (ASX) that are in the same industry. Go to the website of your selected companies. Then ...

Accounting financial assignment -question - in recent years

Accounting Financial Assignment - Question - In recent years a number of companies have gone into liquidation (been 'wound up') because they have not been able to meet their liabilities when they fell due. In Australia, ...

Accounting for decision makingquestion discuss the five key

Accounting for decision making. Question: Discuss the five key forces to consider when analyzing an industry. How do these forces impact the balanced scorecard? Reply to the discussion which are attached. Discussion: For ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As