Konting Kuskus (KK) Corp, operates sales, operating and manufacturing activities of a facility in Sultan Kudarat. It produces and sells variety of products. The following selected costs and expenses relate to the firm's activities and particularly to the factory's department AH, one of the producing departments. Mr. Coco Martillo, the department AH supervisor has the authority over the purchase of materials and supplies in his department; wages of workers that are paid on piece-meal basis: lubricants and oil used in his department, and maintenance cost incurred. The board of Konting Kuskus Corp. Is proposing to eliminate Dept. AH and merge it with Dept. OHA. All costs assigned to Dept. AH will be allocated to the remaining departments and costs and expenses of Konting Kuskus will be saved, except the salary of Mr. Coco Martillo (he will be transferred to other departments) and materials In Dept. AH (will be used by Dept. ОНА). 1. Materials used in dept. AH 2. Factory taxes and insurance 3. Wages of workers in dept. AH 4. Factory heat and power 5. Oll and lubs for equipt. In dept. AH 6. Salary of the sales manager 7. Wages, factory maintenance. Mechanic 8. Depreciation of Equipt. In dept. AH 9. Salary of Mr. Coco Martillo 10. Travel and entertainment 11.Depreciation of sales delivery trucks 12. Salary, factory manager 13. Repairs and Mince., dept. AH 14. Sales commissions on product sold 15. Depreciation, factory equipments Required: Based on a reasonable assumptions about a manufacturing firm, classify each cost as per item: 1. Product (A) or Period (B) 2. Direct (C) or Indirect (D) as to cost of object (Department AH) 3. Fixed (E) or Variable (F) 4. Controllable (G) or Non-controllable (H) 5. Avoidable (1) or Unavoidable (J) Example: 1. Materials used in dept AH Answer: Product, Direct, Variable, Controllable, Avoidable
Konting Kuskus (KK) Corp, operates sales, operating and manufacturing activities of a facility in Sultan Kudarat. It produces and sells variety of products. The following selected costs and expenses relate to the firm's activities and particularly to the factory's department AH, one of the producing departments. Mr. Coco Martillo, the department AH supervisor has the authority over the purchase of materials and supplies in his department; wages of workers that are paid on piece-meal basis: lubricants and oil used in his department, and maintenance cost incurred. The board of Konting Kuskus Corp. Is proposing to eliminate Dept. AH and merge it with Dept. OHA. All costs assigned to Dept. AH will be allocated to the remaining departments and costs and expenses of Konting Kuskus will be saved, except the salary of Mr. Coco Martillo (he will be transferred to other departments) and materials In Dept. AH (will be used by Dept. ОНА). 1. Materials used in dept. AH 2. Factory taxes and insurance 3. Wages of workers in dept. AH 4. Factory heat and power 5. Oll and lubs for equipt. In dept. AH 6. Salary of the sales manager 7. Wages, factory maintenance. Mechanic 8. Depreciation of Equipt. In dept. AH 9. Salary of Mr. Coco Martillo 10. Travel and entertainment 11.Depreciation of sales delivery trucks 12. Salary, factory manager 13. Repairs and Mince., dept. AH 14. Sales commissions on product sold 15. Depreciation, factory equipments Required: Based on a reasonable assumptions about a manufacturing firm, classify each cost as per item: 1. Product (A) or Period (B) 2. Direct (C) or Indirect (D) as to cost of object (Department AH) 3. Fixed (E) or Variable (F) 4. Controllable (G) or Non-controllable (H) 5. Avoidable (1) or Unavoidable (J) Example: 1. Materials used in dept AH Answer: Product, Direct, Variable, Controllable, Avoidable
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter5: Support Department And Joint Cost Allocation
Section: Chapter Questions
Problem 1CMA
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Concept explainers
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Transcribed Image Text:Konting Kuskus (KK) Corp, operates sales, operating and manufacturing activities of a facility
in Sultan Kudarat. It produces and sells variety of products. The following selected costs and
expenses relate to the firm's activities and particularly to the factory's department AH, one of
the producing departments. Mr. Coco Martillo, the department AH supervisor has the authority
over the purchase of materials and supplies in his department; wages of workers that are paid
on piece-meal basis: lubricants and oil used in his department, and maintenance cost
incurred.
The board of Konting Kuskus Corp. Is proposing to eliminate Dept. AH and merge it with
Dept. OHA. All costs assigned to Dept. AH will be allocated to the remaining departments and
costs and expenses of Konting Kuskus will be saved, except the salary of Mr. Coco Martillo
(he will be transferred to other departments) and materials In Dept. AH (will be used by Dept.
OHA).
1. Materials used in dept. AH
2. Factory taxes and insurance
3. Wages of workers in dept. AH
4. Factory heat and power
5. Oll and lubs for equipt. In dept. AH
6. Salary of the sales manager
7. Wages, factory maintenance. Mechanic
8. Depreciation of Equipt. In dept. AH
9. Salary of Mr. Coco Martillo
10. Travel and entertainment
11.Depreciation of sales delivery trucks
12. Salary, factory manager
13. Repairs and Mince., dept. AH
14. Sales commissions on product sold
15. Depreciation, factory equipments
Required: Based on a reasonable assumptions about a manufacturing firm, classify each cost
as per item:
1. Product (A) or Period (B)
2. Direct (C) or Indirect (D) as to cost of object (Department AH)
3. Fixed (E) or Variable (F)
4. Controllable (G) or Non-controllable (H)
5. Avoidable (1) or Unavoidable (J)
Example: 1. Materials used in dept AH
Answer: Product, Direct, Variable, Controllable, Avoidable
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