a) Manufacturing
Cost accountants work closely with production personnel to measure and report manufacturing costs. The efficiency of the production departments in scheduling and transforming materials into finished units is evaluated for improvements.
b) Engineering
Cost accountants and engineers translate specifications for new products into estimated costs; by comparing estimated costs with projected sales prices, they help management decide whether manufacturing a product will be profitable.
c) Systems design
Cost accountants are becoming more involved in designing computer integrated manufacturing (CIM) systems and databases corresponding to cost accounting needs. The idea is for cost accountants, engineers and system designers to develop a flexible production process responding swiftly to market needs
d) Treasury
The treasurer uses budgets and related accounting reports developed by cost accountants to forecast cash and working capital requirements. Detailed cash reports indicate where there are excess funds to invest or where cash deficits exist and need to be financed.
e) Financial accounting
Cost accountants work closely with financial accountants who use cost information in valuing inventory for external reporting and income determination purposes.
f) Marketing
Marketing involves the cost accountant during the product innovation stage, the manufacturing planning stage and the sales process. The marketing department develops sales forecast to facilitate preparing a products manufacturing schedule. Cost estimates, competition, supply, demand, environmental influences and the state of technology determines the sales price that the product will be offered and will command in the market.
g) Personnel
Personnel department administers the wage rate and pay methods used in calculating each employees pay. This department maintains adequate labour records for legal and cost analysis purposes.
Wilfykil answered the question on April 17, 2019 at 05:00
-
The following information for the year ended December 31, 2005 is obtained from the books and records of a factory.
(Solved)
The following information for the year ended December 31, 2005 is obtained from the books and records of a factory.
Factory overhead is 80% of wages and administration overhead 25% of factory cost. The value of the jobs during 2005 was Kshs. 410,000
Prepare:
(i) Consolidated completed jobs account showing the profit made or loss incurred on the jobs.
(ii) Consolidated work – in – progress account.
Date posted:
April 16, 2019
.
Answers (1)
-
As newly appointed cost accounting, you find that the selling price of job No. 5 has been calculated on the following basis:
(Solved)
As newly appointed cost accounting, you find that the selling price of job No. 5 has been calculated on the following basis:
You are required to:
Wage rate: A = Shs. 4 per hour, B = Shs. 6 per hour, C = Shs. 4 per hour.
(a) Draw up a job cost sheet
(b) Calculate and enter the revised costs using the previous year’s figures as a basis (c) Add to the total job cost 10% for profit and give the final selling price.
Date posted:
April 16, 2019
.
Answers (1)
-
The information given below has been taken from the cost records of a factory in respect of job no. 707.
(Solved)
The information given below has been taken from the cost records of a factory in respect of job no. 707.
Fixed expenses estimated at Kshs. 20,000 for 10,000 working hours. Calculate the cost of the job No. 707 and the price for the job to give a profit of 25% on the selling price.
Date posted:
April 16, 2019
.
Answers (1)
-
The following figures are extracted from the Trial Balance of AB. Co. on 31st Sep, 2005.
(Solved)
The following figures are extracted from the Trial Balance of AB. Co. on 31st Sep, 2005.
REQUIRED
Prepare
i) A statement of cost showing various elements of cost.
ii) A statement of profit.
Date posted:
April 16, 2019
.
Answers (1)
-
The following extract of costing information relates to commodity ‘A’ for the half year ending 31st Dec. 2005.
(Solved)
The following extract of costing information relates to commodity ‘A’ for the half year ending 31st Dec. 2005.
Selling and distribution overheads are Sh. 1 per ton sold. 16000 tons of commodity were produced during the period:
Required:
You are to ascertain
(i) Cost of raw materials used
(ii) Cost of output for the period
(iii) Cost of sales
(iv) net profit for the period
(v) Net profit per ton of the commodity.
Date posted:
April 16, 2019
.
Answers (1)
-
During the month of Dec 2008, 16000 units of standard product were manufactured, out of which 13500 units were sold at 8/- per unit.
(Solved)
During the month of Dec 2008, 16000 units of standard product were manufactured, out of which 13500 units were sold at 8/- per unit. The value of raw material consumed was Sh. 60,000 and the direct wages paid Sh. 16,480. The factory expenses were allocated to production at machine hour’s rate which for this month was Sh. 5 per hour and 1200 machine hours were worked during the month. The office expenses are charged @ 20% on works cost and the selling expenses @ 25cts per unit.
Prepare a cost sheet showing
a) Cost per unit and
b) Profit for the month
Date posted:
April 16, 2019
.
Answers (1)
-
A.B.C Manufacturing Company provides the following information for the month of October 19 – 8
(Solved)
A.B.C Manufacturing Company provides the following information for the month of October 19 – 8
Required:
i. Prepare a production cost statement
ii. Prepare a profit statement
Date posted:
April 16, 2019
.
Answers (1)
-
The following figures are supplied to you by contractor for the year ending 31st December, 1981
(Solved)
The following figures are supplied to you by contractor for the year ending 31st December, 1981
Advances from contractee - 40,000
Prepare contract ledger accounts and the total contractee’s account and show the work-in-progress as it would appear in the Balance Sheet
Date posted:
April 16, 2019
.
Answers (1)
-
A building contractor took a contract to build a building on 1st Jan 1980. The contract price was agreed at Kshs. 800,000. The contractor has...
(Solved)
A building contractor took a contract to build a building on 1st Jan 1980. The contract price was agreed at Kshs. 800,000. The contractor has made the following expenditure during the year:
Materials - 50,000
Direct labor - 30,000
Plant - 80,000
Direct expenses - 20,000
From the following extra information prepare a Contract Account for the year. Also show the amount in work in progress, which will be shown in the balance sheet of the contractor.
Value plant 31/12/1980 - 60,000
Stock of material 31/12/1980 - 10,000
Material returned to store - 2,000
Work certified - 150,000
Cash received - 140,000
Cost of work uncertified - 8,000
Date posted:
April 16, 2019
.
Answers (1)
-
Crystal Construction Limited engaged in contract works has the following Trial Balance on 31st December 1975
(Solved)
Crystal Construction Limited engaged in contract works has the following Trial Balance on 31st December 1975
Contract No. 707 having a contract price of Rs. 240,000 was begun on 1st January, 1975 and contractee pays 80% of the work completed and certified. The cost of work done since certification is estimated to be Rs. 1,600. After the above Trial Balance was extracted on 31st December 1975, plant costing Rs. 3,200 was returned to the stores and materials at site on that date were valued at Rs. 3,000. Provision is to be made for sub standard costs amounting to Rs. 600 incurred in contract No. 707 and for depreciation of all Plant and Tools @ 12½% on cost.
Prepare Contract No. 707 Account showing the computation of profit, if any which credit may properly be taken in 1975 and prepare the Balance Sheet for the construction company on 31st December 1975.
Date posted:
April 16, 2019
.
Answers (1)
-
A company of contractors begun to trade on 1st January, 2008.
(Solved)
A company of contractors begun to trade on 1st January, 2008. During 2008 the company was engaged on only one contract of which the contract the contract price was Kshs. 500,000. Of the plant and materials charged to contract: plant costing Kshs. 5,000 and material costing Kshs. 4,000 were lost in an accident. On 31st December, 2008, plant costing Kshs. 5,000 were returned to stores. Cost of work uncertified but finished Kshs. 2,000 and materials costing Kshs. 4,000 were in the hand at site. Charge 10% depreciation on plant and compile contract a/c and balance sheet from the following:-
Date posted:
April 16, 2019
.
Answers (1)
-
Construction Ltd. is engaged on two contracts A and B during the year. The following particulars are obtained at the end of the year (Dec....
(Solved)
Construction Ltd. is engaged on two contracts A and B during the year. The following particulars are obtained at the end of the year (Dec. 31)
During the period materials amounted to Kshs. 9,000 have been transferred from contract A to contract B.
You are required to show.
(a) Contract account
(b) Contractees accounts
(c) Extract from balance sheet as at Dec. 31.
Date posted:
April 16, 2019
.
Answers (1)
-
The following is the Trial Balance of Premier Construction Company engaged on the execution of Contract No. 747 for the year ended 31st December, 2010
(Solved)
The following is the Trial Balance of Premier Construction Company engaged on the execution of Contract No. 747 for the year ended 31st December, 2010
The work on Contract No. 747 was commenced on 1st January 2010. Materials costing Kshs. 170,000 were sent to the site of the contract but those of Kshs. 6,000 were destroyed in an accident. Wages of Kshs. 180,000 were paid during the year. Plant costing Kshs. 50,000 was used on the contract all through the year. Plant with a cost of Kshs. 200,000 was used from 1st January to 30th September and was then returned to the stores. Materials of the cost of Kshs. 4,000 were at site on 31st December, 2010.
The contract was for Kshs. 600,000 and the contractee pays 75% of the work certified. Work certified was 80% of the total contract work at the end of 2010. Uncertified work was estimated at Kshs. 15,000 on 31st December, 2010.
Expenses are charged to the contract at 25% of wages. Plant is to be depreciated at 10% for the entire year. Prepare Contract no. 747 Account for the year 2010 and make out the Balance Sheet as on 31st December 2010 in the books of premier Construction Co.
Date posted:
April 16, 2019
.
Answers (1)
-
From the following information, prepare contract account. Show how these figures appear in the extracts balance sheet as at 31st December, 2005.
(Solved)
From the following information, prepare contract account. Show how these figures appear in the extracts balance sheet as at 31st December, 2005.
Depreciation is to be charged on plant@ 10% which was installed on the opening date of the contract in each case.
Date posted:
April 16, 2019
.
Answers (1)
-
The following particulars relate to a contract undertaken by a firm of engineers.
(Solved)
The following particulars relate to a contract undertaken by a firm of engineers.
The contract price has been agreed at 250,000.
Cash received from the contractee was 180,000
You are required:
(a) To prepare contract showing profit, prepare contractee’s a/c
(b) Balance sheet extract
Date posted:
April 16, 2019
.
Answers (1)
-
A certain product passes through two processes desired before it is transferred to finished stock. The following information is obtained for the month of March,...
(Solved)
A certain product passes through two processes desired before it is transferred to finished stock. The following information is obtained for the month of March, 2006.
Stocks in process are valued at prime cost and finished stock has been valued at the price at which it was received from process II sales during the period were Kshs. 140,000.
Prepare and compute:-
(a) Process cost account showing profit element at each stage
(b) Actual realized profit
(c) Stock valuation for balance sheet purposes
Date posted:
April 16, 2019
.
Answers (1)
-
The cost records show the following costs of producing 200 units of a product in a process
(Solved)
The cost records show the following costs of producing 200 units of a product in a process
The normal wastage is 10% of the units and this wastage can be sold in the market at Kshs. 15 per unit. The actual production was 190 units. Prepare process account and the abnormal effectiveness account.
Date posted:
April 16, 2019
.
Answers (1)
-
The cost record shows the following expenses of manufacturing 200 units of product X in a process:-
(Solved)
The cost record shows the following expenses of manufacturing 200 units of product X in a process:-
The standard normal wastage in production is 10% and it can be sold in the market at Kshs. 15 per unit. The actual production is 150 units due to gross carelessness of workers. Show the treatment of wastage in the process account.
Date posted:
April 15, 2019
.
Answers (1)
-
A company makes a single product with a sale price of Kshs. 10 and a marginal cost of Kshs. 6. Fixed costs are Kshs. 60,000...
(Solved)
A company makes a single product with a sale price of Kshs. 10 and a marginal cost of Kshs. 6. Fixed costs are Kshs. 60,000 p.a.
Calculate;
(a) Number of units to break even.
(b) Sales at break – even point.
(c) C/S Ratio
(d) What number of units will need to be sold to achieve a profit of Kshs. 20,000 p.a
(e) What level of sales will achieve a profit of Kshs. 20,000 p.a
(f) As (d) with a 40% tax rate
(g) Because of increasing costs the marginal costs is expected to rise to Kshs. 6.50 per unit and fixed costs to Kshs. 70,000 p.a . if the selling price cannot be increased what will be the number of units required to maintain a profit of Kshs. 20,000 p.a (ignore tax)
Date posted:
April 15, 2019
.
Answers (1)
-
A plant is operating at 60% capacity. The fixed costs are Kshs. 30,000, the variable costs are Kshs. 100,000 and the sales amount to Kshs....
(Solved)
A plant is operating at 60% capacity. The fixed costs are Kshs. 30,000, the variable costs are Kshs. 100,000 and the sales amount to Kshs. 150,000. Calculate the Break – Even point and find out the % of capacity at which the plant should operate to earn a profit of Kshs. 40,000.
Date posted:
April 15, 2019
.
Answers (1)