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Management Accounting Essay Example
- Category:Finance & Accounting
- Document type:Math Problem
- Level:Undergraduate
- Page:1
- Words:528
MANAGEMENT ACCOUNTING 9
Management Accounting
Management Accounting
M anufacturing department adjustments Canning department adjustments
Labor and overhead materials, labor, and overheads
2,500+4,500 7,000+8,000+2,000
= 7,000 units transferred to next department =17,000 units transferred finished goods store
60% = 2,500 20%=2,000
40% = 40*2,500 80%=80*2,000
=1,667 =8,000
35% = 4,500 70%=8,000
65% = 65*4,500 30%=30*8,000
= 8,357 =3,429
Total labor and overhead Units in progress Total labor and overhead units in progress
= 1,667+8,357 =8,000+3,429
= 10,024 =11,429
Unit prices Unit prices
Transferred in during the month Transferred in during the month
3 6,000/40,000 = 0.9000 12,950/16,000=0.8094
Total costs added = 578,237/10,075 Total costs added =400,000/16,000
= 57.3933 = 25.0000
Costs added by the departments; Costs added by the departments
Overheads =340,000*57.3933 Overheads = 280,000*25.0000
578,237 400,000
= 33.7469 = 17.5000
Labor = 146,800*57.3933 =120,000*25.0000
578,237 400,000
= 14.5707 =7.5000
Materials = 91,437*57.3933
John’s paint products manufacturers house paint
Manufacturing department
Cost of Production Report
For the Month of March, 2011
-
Physical flow units
Units still in process (1,667+8,357) 10,024(40%+65%)
Stated in March 40,000
Units transferred to next stage (2,500+4,500) 7,000 (60%+35%)
Work in progress 31/05/2011 368 5%
-
Equivalent units
Trans in conversion
Completed units and transferred 7,000 7,000
Work in progress on 31 march 368 300
7,368 7,300
-
Total cost accounted for
Cost Charged To the Department: Total Cost Unit cost
Cost from preceding department:
Transferred in during the month 36,000 0.9000
Cost added by the department; Overheads 340,000 33.7469
Labor 146,800 14.5707
Materials 91,437 9.0756
Total cost added 578,237 57.3933
614,237 58.2933
-
Transfer to the next department (7,000*57.3933) = 401,751 401,753
-
Total cost accounted for closing work in progress
Cost Accounted for as Follows:
Work in process — ending inventory:
Adjusted cost from preceding department
Materials 90,974
Labor 14,574
Overhead 10,959
John’s paint products manufacturers house paint
Canning department
Cost of Production Report
For the Month of March, 2011
Quantity Schedule:
-
Physical flow units
Units received from the preceding department 12,950
Units still in process (8,000+3,429) 11,429
Units transferred to finished goods storeroom (7,000+8,000+2,000) 17,000
Units still in progress 1,889 (10%)
-
Equivalent units 2,000 + 8,000 + (2,000*20/100) + (8,000*70/100) = 16,000 units
Trans in conversion
Units transferred to finished goods storeroom 17,000 17,000
Units still in progress 1,889 1,500
18,889 18,500
c. Total cost accounted for
Cost Charged To the Department: Total Cost Unit cost
Cost from preceding department:
Transferred in during the month 12,950 0.8094
Cost added by the department; Overheads 280,000 17.5000
Labor 120,000 7.5000
Total cost added 400,000 25.0000
412,950 25.8094
-
Transfer to storeroom/ finished good (10,000*25.8094) = 254,094 254,094
-
Total cost accounted for closing work in progress
Cost Accounted for as Follows:
Work in process — ending inventory:
Adjusted cost from preceding department
Labor (8,520*7.5000) 63,900
Overhead (11,060*17.5000) 193,550
257,450 Question 5
-
Economic order quantity (EOQ) =
=
= 141.4213 units
-
Bags of species used per day =
=
= 200 bags
-
Re- order level = Average daily usage rate * lead time in days
= 1,000 units
-
Re-order point = normal consumption during lead time + safety stock
=1,000 + 50
=1,050 units
Reference
Mowen, M. M., Hansen, D. R., Mitchell, G., & Tibbits, G,. (2007). Management Accounting.
Iowa: Pearson Education.