agnesgaee
Oct 11, 2010, 01:57 AM
You have been appointed as a management accountant of Auckland Boat Company (ABC). ABC manufactures toy boats for the domestic and export markets.
The standard cost card of ABC is as follows:
STANDARD COST CARD
Direct materials, 6 pounds @ $3.00 per pound . $18.00
Direct labour, 0.8 direct labour-hours $ $15.00 per direct labour-hour . 12.00
Variable manufacturing overhead, 0.8 direct labour-hours $ $3.00 per direct labour-hour ..
2.40
Fixed manufacturing overhead, 0.8 direct labour-hours $ $7.00 per direct labour-hour ..
5.60
Standard cost per unit $38.00
Ms Cathy Brown, assistant accountant of finishing department, has prepared a performance report of September 2010 for tomorrows meeting with top management.
John Black, manager of the finishing department, cannot understand the report Cathy prepared as some of the figures are still missing. He has approached you to help him out.
John: Here is the performance result of our department for the month of September. I need your help to explain these variances at the meeting with top management tomorrow. Im in for a really hard time
Auckland Boat Company (ABC)
Finishing Department
Performance Report for September 2010
Actual production in units
?
Direct Material:
Total standard cost of direct materials $405,000
Material price variance $6,900 F
Material quantity variance $9,000 U
Total actual direct materials purchases $ ?
Total actual direct materials used (in pounds) ?
Direct Labour:
Total standard cost of direct labour $270,000
Labour rate variance $14,550 U
Labour efficiency variance $21,000 U
Total actual direct labour cost $ ?
Manufacturing overhead:
Total standard variable overhead cost applied $54,000
Total actual variable manufacturing overhead cost $ ?
Variable overhead spending variance $1,300 F
Variable overhead efficiency variance $ ? U
Fixed overhead budget variance $500 F
Fixed overhead volume variance $14,000 U
Total actual fixed overhead cost ?
Total budgeted fixed overhead cost ?
Total fixed overhead cost applied $126,000
Required:
Find out the missing figures of the performance report and write a report to the top management explaining your understandings about the potential causes for each variance. Your report should conclude with recommendations on the approaches to be taken to address these variances. [10 marks]
Instructions:
Please follow the instructions below for writing assignment. Failure to follow these instructions will result in lost marks.
This assignment is an individual assessment. The written submission should therefore be your own work.
Length The length of assignment is 500 words maximum
The assignment must be word-processed on ONE side of the page in 12pt font, 1.5 line-spaced. Leave at least 2.6cm margin.
Grammar and spelling must be correct otherwise penalised.
The written assignment to be submitted with the bar-coded coversheet declaring that it is your own work to the drop-box on Level 1 of WF building by 12pm Wednesday 13th October 2010. Include your registered name, student ID number, and lecturers name on the cover sheet.
A soft copy of the same assignment to be submitted to Turnitin by 5pm on the same day. The Turnitin link is available on Assignments folder of AUTONLINE.
FOR TURNITIN: STUDENTS ARE ADVISED NOT TO SUBMIT COVERSHEET, ASSIGNMENT QUESTIONS, INSTRUCTIONS AND REFERNECES LIST TO TURNITIN.
Marks will be given based on the followings: (a) Content/Coverage of issue, (b) Clarity of Discussion, (c) Quality and referencing of materials (if any, used by student)
Plagiarism issues will be strictly handled. Also use APA style for referencing. A soft copy of AUT Assessment Guidelines is posted on AUTONLINE under Course Information.
Indicate the number of words end of your assignment.
This assignment is worth 7.5% of your final grade.
The standard cost card of ABC is as follows:
STANDARD COST CARD
Direct materials, 6 pounds @ $3.00 per pound . $18.00
Direct labour, 0.8 direct labour-hours $ $15.00 per direct labour-hour . 12.00
Variable manufacturing overhead, 0.8 direct labour-hours $ $3.00 per direct labour-hour ..
2.40
Fixed manufacturing overhead, 0.8 direct labour-hours $ $7.00 per direct labour-hour ..
5.60
Standard cost per unit $38.00
Ms Cathy Brown, assistant accountant of finishing department, has prepared a performance report of September 2010 for tomorrows meeting with top management.
John Black, manager of the finishing department, cannot understand the report Cathy prepared as some of the figures are still missing. He has approached you to help him out.
John: Here is the performance result of our department for the month of September. I need your help to explain these variances at the meeting with top management tomorrow. Im in for a really hard time
Auckland Boat Company (ABC)
Finishing Department
Performance Report for September 2010
Actual production in units
?
Direct Material:
Total standard cost of direct materials $405,000
Material price variance $6,900 F
Material quantity variance $9,000 U
Total actual direct materials purchases $ ?
Total actual direct materials used (in pounds) ?
Direct Labour:
Total standard cost of direct labour $270,000
Labour rate variance $14,550 U
Labour efficiency variance $21,000 U
Total actual direct labour cost $ ?
Manufacturing overhead:
Total standard variable overhead cost applied $54,000
Total actual variable manufacturing overhead cost $ ?
Variable overhead spending variance $1,300 F
Variable overhead efficiency variance $ ? U
Fixed overhead budget variance $500 F
Fixed overhead volume variance $14,000 U
Total actual fixed overhead cost ?
Total budgeted fixed overhead cost ?
Total fixed overhead cost applied $126,000
Required:
Find out the missing figures of the performance report and write a report to the top management explaining your understandings about the potential causes for each variance. Your report should conclude with recommendations on the approaches to be taken to address these variances. [10 marks]
Instructions:
Please follow the instructions below for writing assignment. Failure to follow these instructions will result in lost marks.
This assignment is an individual assessment. The written submission should therefore be your own work.
Length The length of assignment is 500 words maximum
The assignment must be word-processed on ONE side of the page in 12pt font, 1.5 line-spaced. Leave at least 2.6cm margin.
Grammar and spelling must be correct otherwise penalised.
The written assignment to be submitted with the bar-coded coversheet declaring that it is your own work to the drop-box on Level 1 of WF building by 12pm Wednesday 13th October 2010. Include your registered name, student ID number, and lecturers name on the cover sheet.
A soft copy of the same assignment to be submitted to Turnitin by 5pm on the same day. The Turnitin link is available on Assignments folder of AUTONLINE.
FOR TURNITIN: STUDENTS ARE ADVISED NOT TO SUBMIT COVERSHEET, ASSIGNMENT QUESTIONS, INSTRUCTIONS AND REFERNECES LIST TO TURNITIN.
Marks will be given based on the followings: (a) Content/Coverage of issue, (b) Clarity of Discussion, (c) Quality and referencing of materials (if any, used by student)
Plagiarism issues will be strictly handled. Also use APA style for referencing. A soft copy of AUT Assessment Guidelines is posted on AUTONLINE under Course Information.
Indicate the number of words end of your assignment.
This assignment is worth 7.5% of your final grade.