GABORONE INSTITUTE OF PROFESSIONAL STUDIES
BCOMM BANKING AND FINANCE YEAR 3
BSC FORENSIC AND FINANCE YEAR 3
ASSIGNMENT
MODULE
:
MANAGERIAL ACCOUNTING
CODE
:
MA 3522
DUE DATE
:
18 SEPTEMBER 2020
TOTAL MARKS
:
80
NUMBER OF PAGES
:
4 PAGES
INSTRUCTIONS TO CANDIDATES:
 Answer all questions
 The use of calculators is allowed
 Answers must be clearly numbered.
 Answer each Question on a Fresh page, e.g. 1a, 1b same page and 2a (i), 2a (ii) on
another page.
 Write neatly and legibly.
1
MA 3522 ASSIGNMENT
QUESTION 1 (25 marks)
a) Define managerial accounting. (3 marks)
b) Explain what is meant by each of the following managerial accounting terms with
examples:
(i)
Process/Continuous costing (4 marks)
(ii)
Joint products vs By-products (6 marks)
(iii)
Period cost vs Product cost (6 marks)
(iv)
Fixed cost vs Variable cost (6 marks)
QUESTION 2 (20 marks)
(a) Stephens Ltd had the following estimated costs for next year:
Advertising exense
$88,000
Direct materials
120,000
Direct labour
440,000
Indirect materials
40,000
Rent on factory equipment
128,000
Sales commissions
600,000
Salary of production supervisor
280,000
The company estimates that 80,000 direct labour hours will be worked and 64,000
machine hours will be incurred during the year. Calculate the overhead absorption
rate (OAR) based on both the direct labour hours and the machine hours. [10
marks]
(b) Match the following statements correctly:
(i)
Relevant costs
(ii)
Primary packaging materials
(iii)
Subsidized canteen facility
(iv)
Cost driver
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MA 3522 ASSIGNMENT
Practical capacity.
Indirect materials.
Control of inventory.
Direct materials.
(v)
JIT System
A factor that causes a change in the total
cost of a cost object.
Future costs affected by decision taken.
Non-monetary incentive. [10 marks]
QUESTION 3 (25 marks)
Kotham (Pty) Ltd manufactures and sells a single product. During the next year it plans to
produce 20 000 units and sell them at $10 each. The budgeted income statement is as follows.
$
Sales
200 000
Less: Cost of Sales;
Direct Material
Direct Labour
Fixed Manufacturing Overhead
Gross profit
Less Fixed Selling & Administrative costs
Net profit
68 000
52 000
24 000
144 000
56 000
30 000
26 000
=====
REQUIRED:
(a) Re-draft the above income statement in marginal cost format (so as to emphasise
the total contribution)
[5 marks]
(b) Calculate the contribution per unit
[5 marks]
(c) Calculate the number of units required to be produced and sold to ‘break even’
[5 marks]
(d) Calculate the expected profit if sales were to be doubled as a result of reducing the
selling price by 15%.
[5 marks]
(e) Calculate the total expected profit if an additional order of 10 000 units at a selling
price of $8 each were accepted.
[5 marks]
Total marks [25 marks]
END OF QUESTION PAPER
3
MA 3522 ASSIGNMENT