EDUTRAIN COLLEGE

DIPLOMA IN ACCOUNTING

MANAGEMENT ACCOUNTING
(CODE: DIA523)
FINAL-TERM EXAMINATION SEMESTER AUG - DEC12
DURATION: 2 HOURS
Read the instructions carefully before answering
Do not open the question paper until you are told so
ATTENTION
1.
2.
3.
4.

Answer ALL questions in Section A.

Answer ALL question from Section B
Answer TWO (2) question from Section C
Write down: NAME, IC NO./PASSPORT NO., STUDENT ID AND LECTURERS
NAME IN THE SECTION PROVIDED.
5. Write your answer on the paper provided.
6. Use only BLACK or BLUE pen to write.
7. Attach this FRONT COVER together with the answer sheet.
NAME
IC NO./PASSPORT NO.
STUDENT ID
LECTURER
SECTION
A
B
C

:
:
:
: MOHD AKRAM KHAN
QUESTION
1
6
2

TOTAL

FULL MARKS
20
30
50
100

MARKS

This examination sheets contain_3_ pages including its front page.

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Section A Answer all questions

1. St Andrew Golf Equipment Plc is golf manufacturer and distributor of golf sets to the
retailer in Malaysia. Please indicate the following classification best describe the cost
item below.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.

Metal used in golf clubs.

Salary of plant manager.
Cost of electricity used for air conditioning in the factory.
Commission paid to sales personnel.
Wages paid to employees who assemble golf bags.
Salary of an engineer who is working on a prototype of a new solar powered
golf cart.
Factory depreciation
Accountant salary in the office
Cost of delivery of golf sets to the retail shops.
Fabric for golf bag
(20 marks)

Section B Answer all questions

2. Define the meaning of idle time in production and 2 examples of idle time?
(5 marks)
3. How the cost of an employees idle time is classified in the manufacturing?
(3 marks)
4. Define the meaning of capital budget?
(4 marks)
5. What are cash disbursements budget and cash receipts budget?
(6 marks)
6. List 4 types of manufacturing operations and describe briefly each process?
(12 marks)
Section C Answer TWO of the following questions
1. As professionals, Managerial Accountants have an obligations to themselves, their

Colleagues and their organizations to adhere to high standards of ethical conduct.

Name the 4 ethical standard sets by Institute Management Accountants (IMA).
(25 marks)

2. Prem Kahani owns a very successful apple orchard in Cameron Highland. He has formed his
own company to produce and package applesauce. Apples can be stored for several months in
cold storage, so applesauce production is relatively uniform throughout the year. The recently

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hired controller for the firm is about to apply the high- low method in estimating the companys
energy cost behavior. The following costs were incurred during the past 12 months:

Month

Liters of Applesauces Produced

January
February
March
Apr
May
June
July
Aug
September
October
Nov
Dec

Energy Cost
RM
23,400
22,100
22,000
22,450
22,900
23,350
28,000
22,800
23,000
22,700
24,100
24,950

35,000
21,000
22,000
24,000
30,000
32,000
40,000
30,000
30,000
28,000
41,000
39,000

Required:
a) Use the high low method to estimate the companys energy cost behavior and express
it in equation form.
b) Predict the energy cost for a month in which 28,000 liters of applesauce are produced
c) Explain the relationship between cost estimation, cost behavior and cost prediction.

(25 marks)
3. Silverline Company manufactures backpacks used by students. A typical
backpack has the following price and variable costs.
Sales price
Direct material
Direct labor
Variable overhead

$45
15
6
9

Budgeted fixed overhead in the companys first year of operation, was $900,000. Actual
and planned production was 150,000 units of which 125,000 were sold. Silverline
incurred the following selling and administrative expenses.
Fixed
Variable

$150,000 for the year

$3 per unit sold

Required:
Compute the product cost per backpack and income statements for the year using under
(a) variable costing and (b) absorption costing.
(25 marks)

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