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    1) O'Coco Enterprise manufactures coconut oil products using virgin coconut oil as a main ingredient. In March 2020, the company had various transactions involving purchasing coconut oil from suppliers and sending oil to production. 2) The document identifies key accounting documents involved in material purchasing such as invoices issued by suppliers, material requisition forms filled by production managers, and goods received notes prepared after receiving materials from suppliers. 3) Marjan Sdn Bhd produces pastries using flour. They use 150kg of flour monthly with minimum and maximum consumption levels. They pay ordering fees and storage costs. They currently order 85kg at a time but want a more economic ordering system.

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    INTRODUCTION TO MANAGEMENT ACCOUNTING-MATERIALS

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    1) O'Coco Enterprise manufactures coconut oil products using virgin coconut oil as a main ingredient. In March 2020, the company had various transactions involving purchasing coconut oil from suppliers and sending oil to production. 2) The document identifies key accounting documents involved in material purchasing such as invoices issued by suppliers, material requisition forms filled by production managers, and goods received notes prepared after receiving materials from suppliers. 3) Marjan Sdn Bhd produces pastries using flour. They use 150kg of flour monthly with minimum and maximum consumption levels. They pay ordering fees and storage costs. They currently order 85kg at a time but want a more economic ordering system.

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    © All Rights Reserved
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    22 views2 pages

    Case Study 2

    Uploaded by

    ain abba
    1) O'Coco Enterprise manufactures coconut oil products using virgin coconut oil as a main ingredient. In March 2020, the company had various transactions involving purchasing coconut oil from suppliers and sending oil to production. 2) The document identifies key accounting documents involved in material purchasing such as invoices issued by suppliers, material requisition forms filled by production managers, and goods received notes prepared after receiving materials from suppliers. 3) Marjan Sdn Bhd produces pastries using flour. They use 150kg of flour monthly with minimum and maximum consumption levels. They pay ordering fees and storage costs. They currently order 85kg at a time but want a more economic ordering system.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 2

    SEMESTER MARCH – AUGUST 2021

    CASE STUDY 2

    ACC319

    A. O’Coco Enterprise manufactures nano-oil products. Virgin coconut oil is one of the main
    ingredients in making the products. Due to small storage space, the company practices
    First-In First-Out in managing their stock movement. The following were the
    transactions which took place in the month of March 2020.

    On 1 March 2020, there were 2,500 litres of coconut oil left in the store. First 1,500
    litres were purchased in January 2020 for RM15,000. The remaining balance was
    purchased in March 2020 for RM12,000.

    March 2020 Transaction


    3 Sent 2,400 litres to production department.
    7 Bought 3,100 litres at RM15.20 per litre from Earth Sdn
    Bhd.
    9 Sent 1,850 litres to production department.
    14 Bought 2,000 litres at RM16.20 per litre (after net of 10%
    discount).
    17 Sent 2,750 litres to production department.
    19 Returned 500 litres on material issued on 14 March
    2020 to supplier.
    22 Bought 3,250 litres at RM18.20 per litre from Earth Sdn
    Bhd.
    25 Sent 2,900 litres to production department.

    The physical stock-taking identified 430 litres left in the store on 28 March 2020
    Required:

    a. Prepare the store ledger card for the month of March 2020 by showing the
    closing stock value.
    (14 marks)

    b. Determine the t ot a l amount of net receipts of coconut oil for the month of
    March 2020.
    (1 mark)

    c. State TWO (2) differences if the company changes its stock valuation method to
    Last-In First-Out approach.
    (2 marks)
    B. Identify the correct documents involved in a material purchasing procedure:

    a. The supplier will issue after the purchase has been made to
    the factory.

    b. The production manager needs to fill in in order to have the


    materials to be issued to the production department from the store.

    c. will be prepared after checking the materials received from


    the supplier.
    (3 marks)

    C. Marjan Sdn Bhd produced ready-made pastry sheets for Malaysia and Singapore
    markets. Flour is the most important material in making the pastry sheets. Based on
    record from January until December 2020, the company uses 150 kg of flour every
    month. The minimum consumption of flour is 100 kg and the maximum consumption
    is 250 kg.

    The company must pay RM12 as ordering fees. The materials need to be stored and
    the company will incur RM3 per kg as handling cost plus RM1 as the insurance fees to
    bring the materials into the factory's store. The delivery of flour to the factory is within
    3 to 5 days. Currently, the company will order 85 kg of flour every time they place an
    order. The company is planning to manage their ordering system economically and
    systematically.
    Required:
    Calculate:

    a. Reorder point level


    (2 marks)

    b. Maximum stock level


    (4 marks)
    c. Minimum stock level

    (2 marks)
    (Total: 28 marks)

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