CONFIDENTIAL 1 AC/MAY 2021/MAF201

UNIVERSITI TEKNOLOGI MARA

COMMON TEST 1

COURSE : COST AND MANAGEMENT ACCOUNTING 1

COURSE CODE : MAF201
EXAMINATION : MAY 2021
TIME : 1 HOUR 30 MINUTES

INSTRUCTIONS TO CANDIDATES

1. This question paper consists of TWO (2) questions.

2. Answer ALL questions in English.

3. Please submit your HANDWRITTEN answers in ONE (1) pdf file.

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 5 printed pages

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 CONFIDENTIAL 2 AC/MAY 2021/MAF201

QUESTION 1

A. State whether each of the statements below is True (T) or False (F)

1. An expected loss on a construction shall be recognised as an expense

immediately regardless of the degree of completion of the contract.
2. There is no requirement for the contractee to make an interim payment to the
contractor.
3. The contract revenue can only be recognised after the completion of the contract.
4. The positive difference between contract revenue and progress billing will be
disclosed as the contract asset.
(4 marks)

B. Universe Sdn Bhd has been awarded a contract to build a playground in Taman Desa
Indah at an estimated price of RM2,500,000. The work commenced on 1 June 2020 and
is expected to complete by 30 September 2021. The following balances have been
extracted from its books on 31 December 2020.

RM
Material:
Purchased from suppliers 600,000
Sent from stores 120,000
Transferred to other sites 10,000
Unused material as at 31 Dec 2020 19,750
Wages paid 240,000
Site expenses paid 40,000
Sub-contractor paid 60,000
Head office expenses 6,000
Establishment charges 80,000
Value of work certified 1,600,000
Cash received from the contractee 85% from the progress billing

Additional information:

a. As at 31 December 2020, the followings information was found:

Wages incurred RM250,000
Site expenses incurred RM35,000
Payment to Sub-contractor for 10% of the total amount
incomplete work paid

b. Machine and equipment were purchased at RM350,000 on 1 Oct 2020. It is the

company policy to depreciate the machine and equipment at 10% per annum on
cost on monthly basis.

c. The management estimated that the further cost to complete the theme park is
RM500,000 and the rectification cost is RM132,250.

d. It is the company's policy to determine the contract revenue based on the input
method.

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 CONFIDENTIAL 3 AC/MAY 2021/MAF201

Required:

a. Prepare the Construction in Progress Account for the year ended 31 December 2020.
(11 marks)

b. Prepare the Contractee Account. (2 marks)

c. Compute the contract asset or contract liability. (2 marks)

(Total: 19 marks)

QUESTION 2

A. Identify the most suitable answers.

1. Sigma Sdn Bhd uses process costing to cost its output. All materials are input at the
beginning of the process. The following information is given for the month of January
2021:

Material input 5,000 kg

Opening work in progress 350 kg
Losses 10% of total input is expected to be rejected
Closing work in progress 250 kg

How many actual units were produced from the process if the actual losses were 500kg?

A. 4,530 kg
B. 4,600 kg
C. 4,465 kg
D. 4,850 kg
(2 marks)
2. Quantum Sdn Bhd uses process costing to cost its output. The following was recorded
for the month of February 2021:

Input materials 1,500 units at RM3.50 per unit

Conversion costs RM12,550
Normal loss 5% of input with the scrap value of RM2.00 per unit
Actual losses 100 units

There was no opening or closing stock this month.

What was the cost per unit of output?

A. RM11.86
B. RM11.97
C. RM12.39
D. RM12.93
(2 marks)

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 CONFIDENTIAL 4 AC/MAY 2021/MAF201

3. The following is the incomplete process for Samudera Sdn Bhd for the month of January
2021.

QTY CPU TOTAL QTY CPU TOTAL

Materials 5,000 15,000 Normal loss 300 1.80 540
Labour 8,250 Finished 4,200
goods
Production 3,500 CWIP 500
Overhead
5,000 26,750 5,000 26,750

There was no opening work in progress for the month of January 2021. The degree of
completion for CWIP was as follows:

Materials 100%
Labour 60%
Production overhead 50%

Calculate the equivalent units for Production Overhead.

A. 4,750 units
B. 5,000 units
C. 4,800 units
D. 4,200 units
(2 marks)

B. Nescoffee Sdn Bhd is a manufacturing company, which manufactures coffee that goes
through two (2) consecutive processes namely Roasting Process and Grinding Process.
The output from Roasting Process is transferred to Grinding Process. The following data

Roasting Process Grinding Process

Opening Work 200 kg
in Progress From previous process RM3,220
Materials added RM2,520
Direct labour RM1,610
Production overhead RM740
Direct materials 5,000 kg at RM32 per kg
Materials added 3,400 kg at RM20 per kg
Direct labour 350 hours at RM12 per hour 650 hours at RM10 per hour
Production RM8,625 RM15,300
overhead
Expected loss 5% of input 10% of production
Scrap value RM3.50 per kg RM4.00 per kg
Output 4,600 kg 7,000 kg
Closing Work in 450 kg
Progress Degree of completion:
Materials added 100%
Direct labour 80%
Production overhead 60%
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 CONFIDENTIAL 5 AC/MAY 2021/MAF201

Required:

a. Prepare Roasting Process account.

(5 marks)
b. Prepare Grinding Process account with the relevant statements.

(16 marks)
c. Prepare the normal loss, abnormal loss/gain account (if any).
(4 marks)
(Total: 31 Marks)

END OF QUESTION PAPER

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