ASSIGMENT 3 SEMESTER 1 SESSION 2013-14 ACCOUNTING FOR DECISION MAKING (ZCZA6103 SET 4) QUESTION 1 Baldu Biru Company produces

s souvenir items for corporate customers. The company uses a job-order costing system and uses traditional costing system in determining its manufacturing overhead cost. Manufacturing overhead is applied to jobs using a predetermined overhead rate based on direct labor-hours. Last year manufacturing overhead was estimated at RM !!"!!!" and direct labor-hours was estimated at #!"!!! hours for the whole year. $n %une #&th" #! '" Baldu Biru Company completed %ob # which contained !! units of stationery holders for (tama Company" its valued customer. The order too) one month to complete. *irect materials costs on the job totaled RM+"!!! and direct labor costs totaled RM'"!!! at the rate of RM ! per hour. . Requ !e"# a.Briefly e,plain why Baldu Biru Company uses job order costing" not process costing. b.-repare the job cost sheet for %ob # " and determine the cost per unit. QUESTION 2 Buddy Corporation" which began operations on %anuary following information. of the current year" reported the

Buddy uses a normal cost system and applies manufacturing overhead to jobs on the basis of direct labor cost. / 0!1 mar)up is added to the cost of completed production when finished goods are sold. $n *ecember ' " job no. + was the only job that remained in production. That

job had direct-material and direct-labor charges of RM 0"&!! and RM'0"!!!" respectively. Requ !e"# a. *etermine the company2s predetermined overhead rate. b. *etermine the amount of under- or overapplied overhead. c. Compute the amount of direct materials used in production. d. Calculate the balance the company would report as ending wor)-in-process inventory.

QUESTION 3 Magenta" 3nc." which uses a job-costing system" is a labor-intensive firm" with many s)illed craftspeople on the payroll. %ob no. 4+5 was the only job in process on %anuary " having costs of RM##"&!! as of that date. *irect materials used and direct labor incurred during %anuary were.

%ob no. 45 was the only job in production as of %anuary ' . Requ !e"#

a. 6hould Magenta use direct labor or machine hours as a cost driver. 7hy8 b. /ssume that the company decided to use direct labor as its cost driver. 3f the budgeted amounts of direct labor and manufacturing overhead are anticipated to be RM#!!"!!! and RM'!!"!!!" respectively" what is the firm2s predetermined overhead rate8 c. Compute the cost of wor)-in-process inventory as of %anuary ' . d. Compute the cost of jobs completed during %anuary. e. 6uppose that the company sold all of its completed jobs" adding a 9!1 mar)up to cost. :ow much would the firm report as sales revenue8