Numerical Non Routine Decisions & Process Costing System Discussion

 

Numerical Non Routine Decisions & Process Costing System Discussion

College of Administrative and Financial Sciences

 

 

 

Assignment 2

Deadline: 21/03/2020 @ 23:59

 

 

Course Name: Cost accounting Student’s Name:
Course Code: ACCT 301 Student’s ID Number:
Semester: 2 CRN:
Academic Year: 1440/1441 H

 

For Instructor’s Use only

Instructor’s Name:
Students’ Grade:  Marks Obtained/Out of 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 answered must be typed using Times New Roman (size 12, double-spaced) No pictures containing text will be accepted and will be considered plagiarism).
  • Submissions without this cover page will NOT be accepted.

 

 

 

Q 1 Give a numerical example of non routine decision, Determine the relevant costs for this non routine decision and discuss the analysis (quantitative and qualitative) required to make the decision?

(1.5 Marks)

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

 

Q 2 Which types of companies would most likely use a process costing system? Provide examples of two Saudi Compagnies.

Explain the methods with which the cost per unit will be calculated for this type of companies.  Explain how the different items of inventory will be evaluated?

(1.5 Marks)

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

 

Q 3 KLM Compagny has two departments, Assembly and Testing.  You are given the following information about the costs of 5 activities that occur at the manufacturing plant monthly:

 

 

Activity                                  Total Costs            Total number of  units of Cost Driver

  • Material handling SAR200, 000            400,000 parts
  • Supervision of direct labor 126,000                     90 employees
  • Janitorial and cleaning 200,000                4,000 hours
  • Machining   300,000                7,000 machine hours
  • Total costs SAR826,000

 

 

The above activities are used by the two departments as follows:

  • Assembly Testing
  • Material handling 200,000 parts                  200,000 parts
  • Supervision of direct labor   40  employees                         50 employees
  • Time spent cleaning     2,000 hours                      2,000 hours
  • Number of machine hours     5,000 machine hours        2,000 machine hours

 

  1. How much of the material handling cost will be allocated to Assembly?
  2. What is the ABC allocation rate for supervision of direct labor?

( 2 Marks)

 

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………