Accounting assessment | KAN

Semester : Spring2 2020 Year : 2019/2020
Course Title : Managerial Accounting
Course Code : ACT310 Section : O1
Instructor : Dr. Gökberk Can and Dr. Suzan Dsouza
Instructions
Submit your assessment answers as handwritten online through
Moodle (with a cover page that incudes your name, ID, and the
Section.)
Due Date August 6, 2020 – 23:59
To be completed by the student
Students Name : Student ID:
Grading Scheme
Question Earned Points Max. Points Question Earned Points Max. Points
1 25 5 20
2 15
3 20
4 20
Total Earned Points Total Available Points Instructor Signature
100
ACT310: Managerial Accounting Final Assessment Spring-2 2020 2 | Page
Question 1 (25 Points)
Macintosh Inc. produces covers for smartphones. The product is sold as single units, which have
the following price and variable costs.
Sales price $40
Direct material 7
Direct labor 4
Variable overhead 2
Budgeted fixed overhead in 2019, the company’s first year of operations, was $420,000. Actual
production was 30,000 units, of which 25,000 were sold. There is no beginning finished goods
inventory. Macintosh Inc. incurred the following selling and administrative expenses.
Fixed in 2019 $65,000
Variable per unit sold 3
Required:
1. Compute the product cost per container of smartphone cover under (a) variable costing
and (b) absorption costing. (10 points)
2. Prepare operating income statements for 2019 using (a) absorption costing and (b)
variable costing. (10 points)
3. Reconcile the operating income reported under the two methods using the shortcut
method. (5 points)
Question 2 (15 Points)
What are the qualities of information? Define them with your own example.
ACT310: Managerial Accounting Final Assessment Spring-2 2020 3 | Page
Question 3 (20 Points)
PLC Makers Company manufactured 8,000 units during August of a PLC device. Records indicated
the following:
Direct labor 49,600 hr. at $12.20 per hr.
Direct material purchased 54,000 lb. at $3.85 per lb.
Direct material used 42,400 lb.
The PLC device has the following standard prime costs:
Direct material: 5 lb. at $3.50 per lb $17.50
Direct labor: 6 hr. at $12.00 per hr 72.00
Standard prime cost per unit $89.50
Required: For the month of August, compute the following variances, indicating whether each is
favorable or unfavorable. (4 points each)
a. Direct-material price variance.
b. Direct-material quantity variance.
c. Direct-material purchase price variance.
d. Direct-labor rate variance.
e. Direct-labor efficiency variance.
ACT310: Managerial Accounting Final Assessment Spring-2 2020 4 | Page
Question 4 (20 Points)
ESOB Sound Company plans to sell 50,000 units in August and 60,000 units in September. The
desired monthly ending inventory in units of finished product is 70 percent of the next month’s
estimated sales. There are 35,000 finished units in inventory on July 31. Each unit of finished
product requires six kilograms of raw material at a cost of $3.65 per pound. There are 70,000
kilograms of raw material in inventory on July 31.
Required: Compute the total estimated cost of raw-material purchases for the month of August.