DEPARTMENT OF FINANCIAL MANAGEMENT
FINANCIAL MANAGEMENT 200
(FBS 200)
EXAM: 30 NOVEMBER 2021
QUESTION PAPER
, FINANCIAL MANAGEMENT 200 DEPARTMENT
EXAM/2021 OF
Marks – 13 FINANCIAL MANAGEMENT
QUESTION 1 – MULTIPLE CHOICE (13 MARKS)
LABOUR (2 MARKS)
DOLLYPOPS (“DollyPops”) manufactures lollipops and other hard sweets. A single factory worker at
DollyPops works 40 hours a week for 48 weeks in a year. Factory workers are paid R75 per work
hour and are entitled to 4 weeks of paid leave in a year. There are 52 weeks in a year.
The best estimate of the annual cost of direct labour for a single factory worker that should have been
allocated to work in progress for the year ended October 2021 is nearest to:
A) R132 000
B) R144 000
C) R156 000
D) R187 200 (2)
OVERHEADS (4 MARKS)
BLINDSIDE (PTY) LIMITED (“Blindside”) manufactures standard sets of bamboo blinds. The following
cost data was obtained for the financial year ended 31 December 2021:
The direct labour cost to produce one standard set of bamboo blinds is R130. The direct labourers are
paid R58.50 per clock hour. They clock eight hours a day but are only productive for 90% of the time.
The fixed overheads are recovered based on work hours per single standard set of bamboo blinds.
The financial manager has correctly calculated the fixed overhead recovery rate at R162 per work
hour.
The best estimate of the fixed overhead amount to be allocated to one standard set of bamboo blinds
is nearest to:
A) R145.80
B) R162.00
C) R324.00
D) R360.00 (2)
Mr Nelson is the financial manager of BRAAIBOYS (PTY) LIMITED (“BB”). BB is a manufacturing entity
and the following cost data was obtained for the month ended 30 November 2021:
The bank statement reflected an amount of R3 131 140 in relation to the fixed manufacturing overhead
for the month. The recovery rate was R10.44 per unit and BB manufactured 250 000 units during the
month of November 2021. Mr Nelson incorrectly recorded an over-recovery of manufacturing
overheads in the fixed manufacturing overhead account for the month of November 2021. All
under/over-recoveries of manufacturing overheads impact cost of sales and are recorded in the fixed
manufacturing overhead account.
To correct Mr Nelson’s error, the required entry in the fixed manufacturing overhead account is closest
to:
A) Debit: R521 140
B) Credit: R521 140
C) Debit: R1 042 280
D) Credit: R1 042 280 (2)
Page 1 of 3
, JOINT & BY-PRODUCTS (3 MARKS)
HONEYBUNS (PTY) LIMITED (“Honeybuns”) produces four different grades of honey from a single
joint process. During the financial year ended 30 November 2021, the following applied:
Litres produced at Further processing Sales value after
Honey grade
split off point costs further processing
Grade A 750 000 litres R1 320 000 R6 000 000
Grade B 1 100 000 litres R900 000 R7 700 000
Grade C 490 500 litres R630 000 R2 943 000
Grade D 102 000 litres R470 000 R561 000
Total 2 442 500 litres R3 320 000 R17 204 000
The total cost incurred during the joint process and to be allocated to the different grades of honey
was R5 798 120.
The gross profit of Grade A honey, using the constant gross profit percentage method to allocate joint
costs, is closest to:
A) R2 199 600.00
B) R2 820 000.00
C) R3 180 000.00
D) R3 977 870.26 (2)
Which of the following statements with regard to joint and by-products is false:
A) None of the joint costs are allocated to the by-product.
B) The costs of disposal of waste or scrap products are added to the joint costs.
C) The joint cost can normally be reduced by the net realisable value of the by-products at
production, when a market for the by-product exists.
D) The net realisable value at split off point method uses the selling price at split off point to split the
joint cost between the joint products. (1)
Page 2 of 3
FINANCIAL MANAGEMENT 200
(FBS 200)
EXAM: 30 NOVEMBER 2021
QUESTION PAPER
, FINANCIAL MANAGEMENT 200 DEPARTMENT
EXAM/2021 OF
Marks – 13 FINANCIAL MANAGEMENT
QUESTION 1 – MULTIPLE CHOICE (13 MARKS)
LABOUR (2 MARKS)
DOLLYPOPS (“DollyPops”) manufactures lollipops and other hard sweets. A single factory worker at
DollyPops works 40 hours a week for 48 weeks in a year. Factory workers are paid R75 per work
hour and are entitled to 4 weeks of paid leave in a year. There are 52 weeks in a year.
The best estimate of the annual cost of direct labour for a single factory worker that should have been
allocated to work in progress for the year ended October 2021 is nearest to:
A) R132 000
B) R144 000
C) R156 000
D) R187 200 (2)
OVERHEADS (4 MARKS)
BLINDSIDE (PTY) LIMITED (“Blindside”) manufactures standard sets of bamboo blinds. The following
cost data was obtained for the financial year ended 31 December 2021:
The direct labour cost to produce one standard set of bamboo blinds is R130. The direct labourers are
paid R58.50 per clock hour. They clock eight hours a day but are only productive for 90% of the time.
The fixed overheads are recovered based on work hours per single standard set of bamboo blinds.
The financial manager has correctly calculated the fixed overhead recovery rate at R162 per work
hour.
The best estimate of the fixed overhead amount to be allocated to one standard set of bamboo blinds
is nearest to:
A) R145.80
B) R162.00
C) R324.00
D) R360.00 (2)
Mr Nelson is the financial manager of BRAAIBOYS (PTY) LIMITED (“BB”). BB is a manufacturing entity
and the following cost data was obtained for the month ended 30 November 2021:
The bank statement reflected an amount of R3 131 140 in relation to the fixed manufacturing overhead
for the month. The recovery rate was R10.44 per unit and BB manufactured 250 000 units during the
month of November 2021. Mr Nelson incorrectly recorded an over-recovery of manufacturing
overheads in the fixed manufacturing overhead account for the month of November 2021. All
under/over-recoveries of manufacturing overheads impact cost of sales and are recorded in the fixed
manufacturing overhead account.
To correct Mr Nelson’s error, the required entry in the fixed manufacturing overhead account is closest
to:
A) Debit: R521 140
B) Credit: R521 140
C) Debit: R1 042 280
D) Credit: R1 042 280 (2)
Page 1 of 3
, JOINT & BY-PRODUCTS (3 MARKS)
HONEYBUNS (PTY) LIMITED (“Honeybuns”) produces four different grades of honey from a single
joint process. During the financial year ended 30 November 2021, the following applied:
Litres produced at Further processing Sales value after
Honey grade
split off point costs further processing
Grade A 750 000 litres R1 320 000 R6 000 000
Grade B 1 100 000 litres R900 000 R7 700 000
Grade C 490 500 litres R630 000 R2 943 000
Grade D 102 000 litres R470 000 R561 000
Total 2 442 500 litres R3 320 000 R17 204 000
The total cost incurred during the joint process and to be allocated to the different grades of honey
was R5 798 120.
The gross profit of Grade A honey, using the constant gross profit percentage method to allocate joint
costs, is closest to:
A) R2 199 600.00
B) R2 820 000.00
C) R3 180 000.00
D) R3 977 870.26 (2)
Which of the following statements with regard to joint and by-products is false:
A) None of the joint costs are allocated to the by-product.
B) The costs of disposal of waste or scrap products are added to the joint costs.
C) The joint cost can normally be reduced by the net realisable value of the by-products at
production, when a market for the by-product exists.
D) The net realisable value at split off point method uses the selling price at split off point to split the
joint cost between the joint products. (1)
Page 2 of 3
