Reference no: EM132702017

ACC 201 Introduction To Cost Accounting - Delaware County Community College

Question 1

TESA COMPANY has 4 production departments A, B, C, D and 2 service departments' canteen and maintenance. The table below summarises other information

	Production departments				Service departments
	A	B	C	D	canteen	maintenance	Totals
Traceable costs	20000	36000	45000	28000	20000	15000	164000
Number of employees	28	89	44	35	13	8	217
Floor area (sqm)	450	600	1500	300	250	334	3434
Kw hours	23000	34000	45000	50000	15000	34000	201000
Value of assets	58000	54000	64000	45000	9000	22000	252000
Output	3400	5000	6000	4600	0	0	19000

The following are the non -traceable overheads for TESA COMPANY

	P
rental	90000
indirect labour	25000
electricity	30000
depreciation	16000
machine insurance	5000
buildings insurance	4000
indirect materials	16000
	P186000

i. Allocate overhead costs to departments using the relevant bases/cost drivers
ii. Apportion service departments to production department using a) simultaneous equation, b) Step down and c) repeated distribution method.

Question 2
a) Assume the following:

High task     10 units

High rate                    P65/unit

Guarantee pay           P500

Employees performing at high task get paid the guaranteed pay +32%

i. Dineo produced 20 units
ii. Thato produced 10 units
iii. Kopo produced 9 units
iv. Lorato produced 12 units
v. Kesego produced 7 units

Calculate the wages for each employee using the Gant task and bonus pay.

b) Assume the following information; calculate the wages to be paid to each employee using Merrick Scheme.

High task            100 units

Normal rate            P50/unit

Pay rates
Normal is paid employees who achieve up to 75% oh high task normal rate + 14% is paid to employees who achieve from 76%-100%
Normal rate +25% is paid to employees who achieve more than high task

i. Moreo produced 120 units

ii. Thuto produced 85 units

iii. Pillar produced 95 units

iv. Ludo produced 65 units

v. Kelly produced 73 units

vi. Banse produced 150 units

c) Assume the following information and use Barth Scheme

Standard time: 10 hours

Rate per hour: P34

Benjamin    5 hours

Kissinger    10 hours

Hobona     8 hours

d) Using information on question c) above, use Rowan scheme to determine the wages for the employees and demonstrate that after all the employees have worked for 40 hours, Benjamin would have earned a lot compared to the other two.

Attachment:- Introduction To Cost Accounting.rar