Ricks' Juice Bar had the following purchases and sales for the month of January 2020. Purchases Sales January 1 300 @ $2.50 6 150 @ $3.00 10 120 @ $4 15 220 @ $9 20 200 @ $3 30 220 @ $9 Required A. Calculate the closing stock using: i. FIFO ii. AVCO (10 marks) B. Calculate the Trading accounts for the month if the closing stock is valued using FIFO and AVCO. (5 marks) C. The following information was obtained from a manufacturing company. Average usage 50 units per day Minimum usage 30 units per day Maximum usage 65 units per day Lead time 10-13 days EOQ (previously calculated) 2 000 units Calculate: i. The reorder level (1 mark) ii. Minimum level (1  marks) iii. Maximum level (1  marks) ACCT2401 21/05 The Council of Community Colleges of Jamaica Page 3 D. The following information relates to stock item ABX123: Ordering costs $50 per order Stockholding costs $2 per unit per annum Annual demand 2500 units i. Calculate the EOQ? (1 mark) (Total 20 marks) Question 2 Pogba Manufacturers produces a product in two phases details of the two processed for a period was as follows: Process 1: Raw material: 6 000 kgs at $50 per kg Direct labour $ 66 000 Production overheads $ 56 100 Normal loss 10% of input Scrap value per unit: $10 Process 2: 

Added materials: 1500 kg at $40 per kg Direct labour: $ 49 000 Production overheads: $ 10 000 Normal loss: 15% of total input Scrap value per unit: $15 Actual outputs for the two processes were as follows: Process 1: 5 500 kgs Process 2: 6 000 kgs A. Prepare the process 1 & 2 accounts (14 marks) B. Prepare the Abnormal Loss & Abnormal Gain accounts (6 marks) (Total 20 marks) ACCT2401 21/05 The Council of Community Colleges of Jamaica Page 4 Question 3 A company manufactures two products, Land M, using the same equipment and similar processes. An extract of the production data for these products in one period is shown below. L M Quality produced (units) 5 000 7 000 Direct labour hours per unit 1 2 Machine hours per units 3 1 Set-up in the period 10 40 Orders handled in the period 15 60 Overhead costs Relating to machine activity 220 000 Relating to production run set-ups 20 000 Relating to handling of orders 45 000 285 000. 

A. Calculate the production overheads to be absorbed per unit of each product based on an ABC approach using suitable cost drivers. (12 marks) 

B. Outline the four stages of the ABC process (4 marks) 

C. State Two advantages and two disadvantages of the ABC System (4 marks)

Answer rating: 100% (QA)

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