MAC2601
ASSIGNMENT 1
SOLUTIONS
PREPARED BY: MTHOMBENI
0767297208
,QUESTION 1
The labour turnover rate is best described as the …
a. total number of employees replaced divided by the average number of employees
on the payroll.
QUESTION 2
Symphony Ltd manufactures a variety of musical instruments. The salaries/wages of the
chief executive officer of the company will be debited to the … account.
a.production overheads
QUESTION 3
Which one of the following statements is not correct?
a.Net wage payable = taxable income plus all employee contributions to benefit
schemes.
QUESTION 4
The main purpose of cost volume profit analysis (CVP analysis) as a tool is ...
c.investigate the change in profit that results from changes in activity levels, per unit
selling prices, per unit variable costs and total fixed cost.
QUESTION 5
Carefully consider the four statements below and then select the correct alternative.
A The management accountant always reports to the financial accountant of the
company.
B The management accountant is responsible for ensuring that the annual financial
statements comply with International Financial Reporting Standards.
C Management accountants provide information that managers need for planning.
D The management accountant is responsible for controlling expenses in the company.
b.Only statement C is correct.
.
QUESTION 6
Which one is a method used for accumulating production costs?
b.Process costing
1
, QUESTION 7
Which one is not an assumption on which cost flows are based?
a.Perpetual method
QUESTION 8
In a perpetual inventory system, purchases of raw material are recorded in the ….
d.Material inventory account
QUESTION 9
The break-even point on the cost-volume-profit (CVP) graph occurs where ...
b.total contribution margin is equal to total fixed costs.
QUESTION 10
Which one represents the frequency with which inventory records can be updated?
a.Periodic method
QUESTION 11
RPG Printers Ltd is the printer of many academic textbooks. Mokone is employed as an
offset printer operator at RPG Printers. He is paid R100 per hour for normal time and time
and a half for all work in excess of the normal 40 hours per week. During the past week,
Mokone was idle for two hours due to machine breakdowns and was idle four hours due to
materials shortages. Rudy was clocked in for 40 hours last week. The apportionment of
Mokone's wages for the past week would be …
c.R3 400 to direct labour and R600 to production overheads.
QUESTION 12
Victorious Limited has a financial year that starts on 1 January and ends on 31 December.
The management accountant of the company has just prepared the budget for the
forthcoming year, based on the following cost structure:
Number of units to be manufactured: 3 500
Direct material: R 73,50 per unit
Direct labour: R 31,50 per unit
Indirect labour (all variable): R42 000
Other manufacturing overheads: R31 500, of which 30% is variable
Selling and administrative expenses (fixed): R42 000
2
ASSIGNMENT 1
SOLUTIONS
PREPARED BY: MTHOMBENI
0767297208
,QUESTION 1
The labour turnover rate is best described as the …
a. total number of employees replaced divided by the average number of employees
on the payroll.
QUESTION 2
Symphony Ltd manufactures a variety of musical instruments. The salaries/wages of the
chief executive officer of the company will be debited to the … account.
a.production overheads
QUESTION 3
Which one of the following statements is not correct?
a.Net wage payable = taxable income plus all employee contributions to benefit
schemes.
QUESTION 4
The main purpose of cost volume profit analysis (CVP analysis) as a tool is ...
c.investigate the change in profit that results from changes in activity levels, per unit
selling prices, per unit variable costs and total fixed cost.
QUESTION 5
Carefully consider the four statements below and then select the correct alternative.
A The management accountant always reports to the financial accountant of the
company.
B The management accountant is responsible for ensuring that the annual financial
statements comply with International Financial Reporting Standards.
C Management accountants provide information that managers need for planning.
D The management accountant is responsible for controlling expenses in the company.
b.Only statement C is correct.
.
QUESTION 6
Which one is a method used for accumulating production costs?
b.Process costing
1
, QUESTION 7
Which one is not an assumption on which cost flows are based?
a.Perpetual method
QUESTION 8
In a perpetual inventory system, purchases of raw material are recorded in the ….
d.Material inventory account
QUESTION 9
The break-even point on the cost-volume-profit (CVP) graph occurs where ...
b.total contribution margin is equal to total fixed costs.
QUESTION 10
Which one represents the frequency with which inventory records can be updated?
a.Periodic method
QUESTION 11
RPG Printers Ltd is the printer of many academic textbooks. Mokone is employed as an
offset printer operator at RPG Printers. He is paid R100 per hour for normal time and time
and a half for all work in excess of the normal 40 hours per week. During the past week,
Mokone was idle for two hours due to machine breakdowns and was idle four hours due to
materials shortages. Rudy was clocked in for 40 hours last week. The apportionment of
Mokone's wages for the past week would be …
c.R3 400 to direct labour and R600 to production overheads.
QUESTION 12
Victorious Limited has a financial year that starts on 1 January and ends on 31 December.
The management accountant of the company has just prepared the budget for the
forthcoming year, based on the following cost structure:
Number of units to be manufactured: 3 500
Direct material: R 73,50 per unit
Direct labour: R 31,50 per unit
Indirect labour (all variable): R42 000
Other manufacturing overheads: R31 500, of which 30% is variable
Selling and administrative expenses (fixed): R42 000
2
