CONFIDENTIAL 1 AC/NOV 2023/MAF151

UNIVERSITI TEKNOLOGI MARA

COMMON TEST

COURSE : FUNDAMENTALS OF COST ACCOUNTING

COURSE CODE : MAF151
EXAMINATION : NOVEMBER 2023
TIME : 1 HOUR 30 MINUTES

INSTRUCTIONS TO CANDIDATES

1. This question paper consists of FIVE (5) questions.

2. Answer ALL questions in the Answer Booklet. Start each answer on a new page.

3. Do not bring any material into the examination room unless permission is given by the
invigilator.

4. Please check to make sure that this examination pack consists of:

i) the Question Paper

5. Answer ALL questions in English.

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

This examination paper consists of 4 printed pages

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 CONFIDENTIAL 2 AC/NOV 2023/MAF151

QUESTION 1

A. Differentiate between Cost Accounting and Financial Accounting in terms of the

following:

i. User orentiation
ii. Reporting frequency
(2 marks)

B. Define direct material and indirect material and give ONE (1) example for each.

(4 marks)

C. State the appropriate term or phrase for the following descriptions:

i. Cost that is not included in the product cost but relates to day-to-day business
operation.
ii. Cost that will remain constant when the activity level changes.
iii. Cost incurred during the transformation of raw materials into finished goods.
iv. Cost that can be identified specifically and exclusively with a given cost object.

(4 marks)
(Total: 10 marks)

QUESTION 2

GoHealthy Sdn Bhd produces healthy dietary supplements for those who are intended to lose
weight. The following relates to the costs incurred by the company in the month of October
2023.

RM
Raw materials 54,000
Raw materials returned 1,900
Other indirect materials 18,000
Wages for direct labour 21,000
Wages for indirect labour 15,500
Electricity (60% production, 40% non-production) 12,000
Depreciation of machinery 2,700
Depreciation of office equipment 1,800
Maintenance of machines 3,300
Interest on loan 860
Hire of special equipment 2,300
Office rental 2,500
Supervisor salary 4,800
Wages of packers 7,500
Wages of deliveryman 6,000
Research and development cost 9,600
Depreciation of delivery van 1,100

Required:

Prepare a cost statement for GoHealthy Sdn Bhd by clearly showing the Prime Cost,
Production Cost and Total Cost for the month of October 2023.
(Total: 10 marks)

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 CONFIDENTIAL 3 AC/NOV 2023/MAF151

QUESTION 3

Store control is one of the areas included in material control system. The purpose of store
control is to control stock levels so that overstocking or understocking will not happen in
production.

A. List THREE (3) effects of understocking.

(3 marks)

B. State TWO (2) variables that need to be considered in setting the stock level.
(2 marks)
(Total: 5 marks)

QUESTION 4

A. Temerloh Paste Sdn Bhd is well known for its Patin Tempoyak Paste. One of the main
ingredients is tempoyak, which is made by fermenting most types of durians. The
production of Patin Tempoyak Paste is between 300 to 500 packets per week. Each
packet of Patin Tempoyak Paste requires 250 grams of tempoyak. The weekly usage
of tempoyak is between 75 kilograms to 125 kilograms. The company usually
purchases tempoyak at 350 kilograms at a time. Lead time of purchase varies from 3
to 5 days.

Required:

Calculate the followings:

i. Reorder level
ii. Minimum stock level
iii. Maximum stock level.
(6 marks)

B. Triplet Copies Sdn Bhd is a local company that is involved in printing limited-edition
documentary books. Each unit of book requires 8 litres ink. The annual demand for the
limited-edition documentary books is 4,000 copies. The cost of storing ink is RM3 per
litre and the ordering cost is RM120 per order. The company buys the ink from a
supplier at a purchase price of RM65 per litre.

Required:

i. Calculate the company’s Economic Order Quantity (EOQ) using formula.

(3 marks)

ii. Calculate the total cost (ordering cost and storage cost) for the ink if the
company order based on EOQ in (i) above.
(6 marks)
(Total: 15 marks)

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 CONFIDENTIAL 4 AC/NOV 2023/MAF151

QUESTION 5

The following transactions are related to the purchase and issuance of pineapples MD2 for
Borneo Pineapple Juice Sdn Bhd for the month of October 2023:

Date Transactions RM

October 1 Balance of pineapples from last month of 1,600 kgs 20,800

5 Issued 700 kgs
8 Purchased 1,800 kgs 25,200
11 Purchased 900 kgs 13,500
13 Return to supplier 300 kgs at the latest purchase price
20 Issued 3000 kgs
21 Purchased 2,200 kgs 35,200
26 Issued 1,500 kgs
27 Issued 330 kgs

A stock count on 31 October 2023 showed a balance of 650 kgs of pineapples MD2.

Required:

Prepare a store ledger card for the month of October 2023 using First-In-First-Out (FIFO)
method.
(Total: 10 marks)

END OF QUESTION PAPER

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