MA1 2014-2015

MANAGEMENT ACCOUNTING

MODULE 1

PART 5 Slide 67: Exercise 1-2 pages 24-25
Solution
1. 2. 3. 4. 5. 6. 7. 8. 9. work in process Six Sigma business process corporate governance enterprise risk management just-in-time business risks Non-value added activity value chain

10. enterprise system 11. code of professional ethics 12. lean thinking model 13. customer value proposition 14. Sarbanes Oxley Act 15. corporate social responsibility

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MA1 2014-2015

MANAGEMENT ACCOUNTING

MODULE 1

PART 5 Slides 68 – 70: Past CGA Exam question For the year ended March 31, 1993, you are given the following data: Direct materials used Manufacturing overhead Total manufacturing costs Beginning work-in-process inventory Cost of goods manufactured Sales Beginning finished goods inventory Cost of goods sold Net income Required Compute the following: 2 a. Direct labour 2 b. Ending work-in-process inventory 2 c. Goods available for sale 2 d. Ending finished goods inventory 2 e. Operating expenses $ 9,000 20,000 37,000 3,500 30,000 50,000 2,000 27,000 3,000

Solution Take what you are given and use it to try to determine the missing parts. You must understand the format and calculations for the schedule of cost of goods manufactured and the income statement. Calculations: Direct materials used Direct labour MOH Total manufacturing costs WIP, beginning (WIP, end) COGM 9,000 (a) 20,000 37,000 3,500 (b) 30,000 (a) = 37,000 – (20,000 +9,000) = 8,000

(b) = 10,500 37,000 + 3,500 - (b) = 30,000

Sales COGS Finished goods, beginning COGM Goods available for sale (Finished goods, end) COGS Gross profit Operating expenses Net income

50,000 2,000 30,000 (c) (d) 27,000 23,000 (e) 3,000 -2-

(c) = 2,000 + 30,000 = 32,000 (d) = 32,000 - 27,000 = 5,000

(e) = 23,000 - 3,000 = 20,000

MA1 2014-2015
PART 6 Slides 72 – 74: Past CGA Examination