## Distinguish between job costing and process costing. Give your own examples.

Your assignment consists of different question styles including discussion questions, reports, exercises, problem questions and spreadsheet questions. It assesses learning outcomes as listed in the assignment rationale below.

The purpose of this assignment is to continue to develop skills in costing systems with an emphasis on the role of control in managing the production of goods and services efficiently in the workplace. Each question builds on the knowledge gained through the first assignment to develop the concepts of management accounting control through costing. Each question uses realistic data and professional practices similar to that found in workplaces.

QUESTION 1 Job costing:

1. A. Create a spreadsheet solution to the following problem. Follow the template provided.
Play the Job cost podcasts and work through the example problem in those podcasts.

1. B. Distinguish between job costing and process costing. Give your own examples.

QUESTION 2 Process costing:
Prepare a spreadsheet to solve the following process costing problem.
Review the four process costing videos provided in Interact Resources. Note that in the situation below there are two production departments.

QUESTION 3 Joint costing – decision making:
Create a spreadsheet to solve the following joint cost problem.

Joint cost allocation: additional processing beyond split-off point
In a certain production process 100 000 kg of a single raw material were processed at a cost of \$250,000. At split-off two intermediate products, A and B emerged, weighed as 60,000 kg of A and 40,000 kg of B. A was processed further at a cost of \$45,000 to produce C, and B was processed further at a cost of \$25,000 to produce D. C sold for \$4.50 per kg.

Required:
(a) If A was allocated \$187,500 of the joint production costs under the net realisable value method, what was the selling price of D?
(b) Suppose the firm receives an offer to buy all of product A for \$2 per kg at the split-off point. Would the firm be better off selling A or processing further to produce C? By how much?

Question 4 Variance analysis

Borg Ltd has set up the following standards for material and labour:
Materials:       10 kg @  \$6
Direct labour:    1 hr @ \$20

During a month 19,500 units were produced, 197,000 kg of material were used and 20,100 hours of labour were worked. 220,000 kg of materials were purchased for \$1,364,000.

Required:
(a) Calculate the materials price variance (on purchase) and materials usage variance.
(b) If the total direct labour variance was \$1,950 unfavorable, what was the actual direct labour rate per hour?
(c) Journal entries to record these facts.

1. A. Answer the requirements using a spreadsheet. Include the IF function to determine Favourable and Unfavourable variances.
B. Prepare a Business Report as if for senior management critically evaluating the purpose of variance analysis, why the materials price variance should be calculated on purchase, other areas in an organisation where variance analysis would be useful and the practical relevance of detailed overhead variance analysis. See the reading by Murray Wells. Search the CSU library for the ACC512 readings. Suggested word limit about 500 words. Ensure that your answer is in business report format. Read the following online references regarding business report writing.
and
http://unilearning.uow.edu.au/report/4b.html

QUESTION 5 Budgeting

A.

1. B. Write a business report describing budgeting as a non technical process. Refer to satisfying, budgeting as a political process and budget ploys. Give examples. About 500 words excluding references. Use the Internet as a reference AND refer to relevant academic research papers. See the text page 249

Rationale

This assignment assesses your achievement of learning outcomes including the application of cognitive skills in the design and operation of costing systems; the design and operation of performance management systems; the role of management accounting in organizational contexts and the implications for management accounting of different paradigms; the application of analytical and synthetically skills in report writing; quantitative techniques and computer software including using the Internet as a professional source; the creation and implementation of computerised decision models; and to critique how managers make decisions.

In particular, this assignment is designed to assess your application of knowledge, understanding and skills in certain topics including cost flows in management accounting, spreadsheet construction, job and process costing, variance analysis, joint costing and budgeting.​

For spreadsheet problems, good answers will comply with the spreadsheet requirements including the separation of data entry and report/solution areas, pasted normal and formula view with row and column headings and the use of the IF function where appropriate.
Review the examples in the Spreadsheet Advice PDF provided online in Interact2 Resources.

Marking criteria

For spreadsheet questions formula views showing row and column headings are important.
Your assignments will be marked as a whole with recognition being given to application of knowledge, quality thinking and application of skills. For some questions, students have a chance to demonstrate some creativity, or provide their own examples or give evidence of wider reading or structure a computer spreadsheet model in an innovative manner. We also need to avoid the snowballing effects of cumulative errors – that is, an error early in a practical question which carries through. Thus a marking system is used with deductions for errors and omissions. Full marks are possible for well structured, complete, quality answers.