accounting control systems tutor marked assignment 8 40576 08 accounting controls 270653

Accounting Control Systems
Tutor Marked Assignment 8 40576/08
Accounting Controls
Answer all questions.
Describe and outline the steps involved in setting up and operating a standard costing system.
2 Discuss the practical problems of budgeting and budgetary control within an organisation. How might these be overcome?
Calculate the material price and usage variances, and the wage rate variance and labour efficiency variances for the following data.
Labour Labour Material Material Units Month Usage Cost Usage Cost Produced (Hrs) (f) (M) (f)
Standard 2.2 10.89 2.9 7.25 1 April 1990 35760 171648 44700 116220 14900
After you have completed these calculations, briefly explain your results. 4 Factory X produces a single product which is made from 10 kg of Material A and 5 kg of Material B. These quantities allow for waste. The purchase prices of these materials are: Material A f0.50 per kg of annual quantities up to 80,000 kg, with a discount of 5% for annual quantities over 80,000 kg and 10% over 100,000 kg. The discount is applied to the whole order. Material B f0.20 per kg of annual quantities up to 50,000 kg, with a discount of 10% if over 50,000 kg and 15% over 100,000 kg. The discount is applied to the whole order. The policy is to order only sufficient material to meet production requirements. The normal annual capacity of the factory is 12,000, and this requires 50,000 direct labour hours at a cost of f0.60.
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