Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3,000 units during the year. These camping
Question:
Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3,000 units during the year. These camping tents sell for RM150 each. BSB had 500 units in finished goods inventory at the beginning of the year.At the end of the year,there were 800 units in finished goods inventory. The following information was supplied by its accountant:
RM | |
Direct labour cost | 10,500 |
Purchases of raw materials | 15,000 |
Depreciation of machinery | 1,000 |
Insurance expenses | 4,500 |
Factory rent | 2,000 |
Factory supervision | 3,000 |
Utilities expenses | 2,500 |
Indirect labour cost | 3,500 |
Administration salaries | 15,000 |
Sales Commission | 12,000 |
Advertising | 20,000 |
Materials inventory, May 1 | 6,000 |
Work in process inventory, May 1 | 12,000 |
Finished goods inventory, May 1 | 2,100 |
Materials inventory, May 31 | 8,000 |
Work in process inventory, May 31 | 7,000 |
Finished goods inventory, May 31 | 800 |
Additional information:
Only 70% of the utilities expense and 80% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities.
Required:
- Compute prime cost, manufacturing cost and cost of goods manufactured.
- Compute cost of goods sold.
Cornerstones of Managerial Accounting
ISBN: 978-0324660135
3rd Edition
Authors: Mowen, Hansen, Heitger