How to login to NOUN Elearn Portal
You can now use you matric number to login as your username and password in a lowercase.
https://elearn.nouedu2.net/login/
Note that you are to change your passw...
NATIONAL OPEN UNIVERSITY OF NIGERIA
UNIVERSITY VILLAGE, PLOT 91, CASDASTRAL ZONE, NNAMDI AZIKIWE EXPRESS WAY, JABI, ABUJA.
FACULTY OF MANAGEMENT SCIENCES
APRIL/MAY 2019 EXAMINATION
COURSE CODE: ACC313
CREDIT UNIT: 3
COURSE TITLE: MANAGEMENT ACCOUNTING
TIME ALLOWED: 21/2 HRS
INSTRUCTIONS:
1. Attempt Question One (1) and any other three (3) questions
2. Question 1 carries 25 marks, while the other questions carry 15 marks each.
3. Present all points in coherent and orderly manner
Q1.
Okakwu Nigeria Limited produces standing fans which pass through three processes to completion. In May 2018 the cost of production were as follows:
|
Element of cost |
Process A (N) |
Process B (N) |
Process C (N) |
Total (N) |
|
Direct Material |
4,000 |
6,040 |
6,924 |
16,964 |
|
Direct Labour |
6,000 |
8,000 |
10,000 |
24,000 |
|
Direct Expenses |
1,000 |
452 |
==== |
1,452 |
|
Production overhead |
===== |
===== |
===== |
12,000 |
2,000 units at N10 each were issued to process A.
Output of A = 1,840 units; Output of B = 1,740 units; Output of C = 1,600 units
Normal Loss per process was estimated as Process A = 10%; Process B = 10% and
Process C =10%.
The loss in each process represented scrap which could be sold to a merchant at a value as follows: Process A = N6 per unit; Process B = N10; and Process C = N12.
There was no stock of materials or work in progress in any department at the beginning or end of the period. The output of each process passes direct to the next process and finally to finished stock. Production overhead is absorbed by each process on a basis of 50% of the cost of direct labour.
Requirements:
Prepare the Process Account of all the processes, Abnormal loss/gain Accounts and Finished Stock Accounts at the end of May, 2018. (25 Marks)
Q2.
Monica and Associates are making projections for the year ending 31st August 2018. The sales and purchases forecasts for part of the period are as follows:
|
Year/Month |
Sales forecasts (N’000) |
Purchases forecasts (N’000) |
|
November 2017 |
180 |
100 |
|
December 2017 |
200 |
140 |
|
January 2018 |
170 |
110 |
|
February 2018 |
160 |
110 |
|
March 2018 |
140 |
100 |
|
April 2018 |
140 |
90 |
|
May 2018 |
130 |
90 |
|
June 2018 |
120 |
80 |
|
July 2018 |
120 |
80 |
The company experienced that only 20% of the sales can be collected in the month of sales, 60% in the following month and 20% to be collected two months following the month of sale.
Again, 30% of all purchases are paid for in the month of acquisition and 70% will be paid for in a month later.
Monthly rent is N3,800.
Salaries and wages N28,000 to be paid monthly.
Lease payment N2,400 to be paid monthly.
Depreciation on fixed assets N200 every month.
Taxation to FIRS N11,200 to be paid on 28th April 2017.
A new machinery N8,000 to be paid February and June 2018.
Other expenses will average 1% of each month’s purchases.
The company desires a minimum monthly cash balance of N20,000. The cash balance as at 1st January, 2018 is N58,000.
Requirements:
Prepare for Monica and Associates a cash budget for the 1st half (i.e. January – June) 2018, Showing monthly cumulative cash balances without borrowing and investible cash or required borrowing. (15 Marks)
Q3. Discuss Costing Methods and Techniques. (15 Marks)
Q4. Present fifteen (15) reasons why cost accounting is necessary in an organization. (15 Marks)
Q5.
Write short note on the following:
- Idle Capacity (3 Marks)
- Predetermined Cost (3 Marks)
- Abnormal Costs (3 Marks)
- Throughput Method (3 Marks)
- Cash Budget (3 Marks)
.
(Total 15 Marks)
Q6. Discuss Budgetary Control and Budget. Explain the objectives of Budgetary Control. (15 marks)
