MAC3701 Application of Management Accounting Techniques (MAC3701)

MAC3701 SUMMARY STUDY NOTES 2022. PLANNING AND CONTROLLING INVENTORY Cost of holding inventory is expensive – capital is needed to create suitable infrastructure (factory, staff, computers, stationery etc) and cash flow also needed for operational activities of entity. Investment in inventory and inventory infrastructure is committed fixed costs which are managed over medium to longterm. Because of high costs and risks of holding inventory entity should keep inventory levels as low as...

Section A Multiple Choice Questions 1. A common business decision is the make/buy decision where a manager must choose between buying an item or manufacturing it. The company must evaluate both the qualitative matters, as well as the quantitative matters that deal with costs. The following statements were made by a manager regarding qualitative matters which will influence his decision: 1. The risk of destroying long-run relationships with suppliers, which may prove to be harmful and dis...

Section A Multiple Choice Questions 1. A common business decision is the make/buy decision where a manager must choose between buying an item or manufacturing it. The company must evaluate both the qualitative matters, as well as the quantitative matters that deal with costs. The following statements were made by a manager regarding qualitative matters which will influence his decision: 1. The risk of destroying long-run relationships with suppliers, which may prove to be harmful and dis...

Application Of Management Accounting Techniques. A common business decision is the make/buy decision where a manager must choose between buying an item or manufacturing it. The company must evaluate both the qualitative matters, as well as the quantitative matters that deal with costs. The following statements were made by a manager regarding qualitative matters which will influence his decision: 1. The risk of destroying long-run relationships with suppliers, which may prove to be harmful...

MAC3701_ MANAGEMENT ACCOUNTING_ Study_Pack__2019. ECONOMIC ORDER QUANTITY (EOQ) FORMULA AND ITS COMPONENTS. Calculating variances 2. Commenting on variances Common Variances: 1 Material Price Variance = (SP- AP) x Actual Quanty Purchased * SP = Standard Price * AP= Actual Price 2 Material Usage Variance = (Standard Usage on Actual production - Actual Usage) x SP 3 Material Mix Variance = Material Type Actual Mix less Actual in Budget Proportions Variance in Units x Standard Price (SP) ...

MAC3701_Study_Pack_STUDY NOTES + ASSIGNMENTS and EXAMS PACK Table of contents Topic Learning Unit Pages Economic Order Quanty (EOQ) 1 3 - 10 Standard Costing and Variance Analysis 2 11 - 19 Multi- Volume Product Analysis 3 20 - 28 Transfer Pricing and Performance Measurement 4 29 - 34 Direct and Absorption Costing 5 31 - 36 Activity Based Costing (ABC) 6 35 - 49 Process Costing 7 50 - 53 Cost Estimation and Cost Behaviour 8 54 - 57 Typical Exam Questions and Solutions 58 - 100 Semest...

STUDY NOTES STUDY UNIT 1-Advanced Behavioural aspects of Costs In second year cost and management accounting, you studied on the classification of costs and the behaviour of costs. Three nature of costs can be determined in manufacturing, i. e, variable, fixed and semi-variable. This study unit goes further into the determination of the. 1. Behaviour of Variable costs of Inventory using the most widely used inventory control 2. Behaviour of semi-variable costs using the simple correlati...

This document contains suggested solution and detailed workings