Professional Documents
Culture Documents
2011/12 S2 Test # 1
Total Score
Name: _____________________________________________________
Class & Instructor
Instructions:
1.
2.
Please write your answers legibly only in the boxes provided. Show your
workings clearly.
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2011/12 S2 Test # 1
Period cost
(1b)
2011/12 S2 Test # 1
Answer (1b)
Sales
Variable costs
Vanilla
$400,000
$100,000
Chocolate
$200,000
$80,000
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2011/12 S2 Test # 1
(b) BR is considering paying a sales commission of 10% of sales to motivate its retail
staff. What is the additional total sales that must be made to make paying the
sales commission worthwhile?
(10 marks)
Answer (2b)
(c) Compute the additional sales (in dollars) of Vanilla and Chocolate ice cream
required if BR wants to increase operating income by 100%.
(5 marks)
Answer (2c)
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2011/12 S2 Test # 1
Job A
Job B
Job C
Total
No. of setups
Budget Actual
4
5
7
8
9
15
20
28
Budgeted Manu
Overhead $
$180,000
$40,000
$15,000
$235,000
Actual Manu
Overhead $
$100,000
$159,500
$10,000
$269,500
BWC uses activity-based costing to allocate overhead costs. Its policy is to write off
any under- or overapplied overhead to cost of goods sold.
Required
(a) Compute the manufacturing overhead application rates.
Answer (3a)
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(6 marks)
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2011/12 S2 Test # 1
(14 marks)
2011/12 S2 Test # 1
Answer (3b)
Raw Materials
8,000 (b)
Bal
(a)
Bal
(d)
10,000
BWIP
Raw Materials
DL
(f)
(g)
WIP: Job A
0
8,000
20,000
Bal
(h)
WIP: Job B
(j)
Raw Materials
DL
(k)
BWIP
Raw Materials
DL
(o)
FG: Job A
0
Bal
15,000
50,000
(m)
FG: Job B
2,000
(n)
(l)
WIP: Job C
5,000
9,000
30,000
(p)
Bal
(q)
(r)
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FG: Job C
7,000
2011/12 S2 Test # 1
: $342,000
: $171,000
The usage of the service departments output for the year is as follows:
Provider of Service
Administration
Maintenance
User of Service
Administration
Maintenance
Piano
Violin
10%
40%
50%
5%
60%
35%
Required
(a) As the manager of the Piano Department, would you prefer budgeted or actual
cost allocation rates be used to allocate the service department costs to your
department? Why?
(10 marks)
Answer (4a)
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2011/12 S2 Test # 1
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2011/12 S2 Test # 1
End of Quiz
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