CIMA Official Learning System Fundamentals of Management Accounting 4th. Edition by Janet Walker | 9781856177924 | 1856177920 | Holooly

Accounting for Business

CIMA Official Learning System Fundamentals of Management Accounting

376 SOLVED PROBLEMS

Question: 11.E.2

C Ltd makes two products, Alpha and Beta. The following data is relevant for year 3: Material prices: Material M £ 2 per unit Material N £ 3 per unit Direct labour is paid £10 per hour. Production overhead cost is estimated to be £200,000, which includes £25,000 for depreciation of ...

Verified Answer:

Note the order in which the budgets are prepared. ...

Question: 10.RQ.1.4

Records for a passenger limousine company reveal the following data for last period. The drivers ’ wages cost incurred was £1,100. The drivers ’ wages cost per passenger mile was (to the nearest penny): (A) £0.03 (B) £0.18 (C) £1.41 (D) £22.45 ...

Verified Answer:

(B)

\begin{array}{ccc}\text{No. of passenge...

Question: 9.E.3

To give yourself some extra practice, draw up the abnormal gain account and the scrap account ...

Verified Answer:

Abnormal gain account £ £ Scrap stock (20× £...

Question: 3.9.5

This example demonstrates how the profit mark-up can be determined as a percentage of the total budgeted cost for a period. The following data relate to a company which produces a range of products. ...

Verified Answer:

Required profit in period = £800,000 × 15% = £120,...

Question: MA2.7

The following information is required for questions 7 and 8 The incomplete process account relating to period 4 for a company which manufactures paper is shown below There was no opening work in process (WIP). Closing WIP, consisting of 700 units, was complete as shown ...

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Solution 7 Process account = credit; abnormal gain...

Question: 9.RQ.1.14

The value of completed output for the period was (A) £ 171,555 (B) £ 201,500 (C) £ 274,488 (D) £ 322,400 ...

Verified Answer:

(D) Equivalent units table Materials Labour ...

Question: MA2.29

The following results were achieved in the last accounting period: r = $50,000 w = $16,000 t = 800 units u = 2,500 units The company expects to make and sell an additional 1,400 units in the next accounting period. If variable cost per unit, selling price per unit and total fixed costs remain unchanged, profit will increase by $ ...

Verified Answer:

Profit will increase by $28,000. Contribution per ...

Question: MA2.6

The normal loss in process 2 is valued at its scrap value. Extracts from the process account and the abnormal gain account for the latest period are shown below ...

Verified Answer:

A = £715 B = £979 Workings: Cost per complete u...

Question: MA2.5

Which of the following costs would be classified as production overhead cost in a food processing company (tick all that apply)? The cost of renting the factory building. The salary of the factory manager. The depreciation of equipment located in the materials store. The cost of ingredients ...

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The costs are all production overheads with the ex...

Question: 12.RQ.34

PP Ltd has prepared the following standard cost information for one unit of product X: Direct materials 2 kg @ £13/kg £26.00 Direct labour 3.3 hours @ £12/hour £39.60 Variable overheads 3.3 hours @ £2.50 £8.25 Actual results for the period were recorded as follows: Production 12,000 units ...

Verified Answer:

● Remember that all the ‘ quantity ’ variances (ma...

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