Managerial Accounting (ACCM3204)
Faculty of Economics and Management Science (FEMS)
Semester: Second Semester
Level: 300
Year: 2017
Part A: Mr. Ngoh-15marks
The company BUH-LRNGI, located in KUMFUTU is a manufacturing company. Its total
overhead costs at various levels of activity are presented as follows:
MONTHS MACHINE HOURS TOTAL OVERHEAD COSTS (FCFA)
January 50,000 162,000
February 40,000 140,600
March 60,000 183,400
April 70,000 204,800
Assume that the overhead costs consist of utilities, supervisory salaries and
maintenance. The proportion of these costs at the 40,000 machine-hours level of activity is:
Utilities (V) 42,400FCFA
Supervisory salaries (F) 39,300FCFA
Maintenance (M) 58,900FCFA
Total overhead costs 140,000FCFA
V = Variable; F = Fixed; M = Mixed
The company wants to break the maintenance cost into its basic variable and fixed cost
elements.
Requires;
1) As shown above, overhead costs in April amounted to 208,800 FCFA. Determine how much
this consisted of maintenance cost. (Hint; to do this, it may be helpful to first determine how
much of 204,800 FCFA consisted of utilities and supervisory salaries. Think about the behavior
of variable and fixed costs within the relevant ranges)
2) By means of high-low method, determine the cost formula for maintenance.
3) Express the company’s total overhead costs in the linear equation form: y = ax + b.
4) What total overhead costs would you expect to be incurred at an operating activity level of
60,000 machine hours?
Part B; Mr. Godlove- 15marks
DOH. Ltd establishes an estimated cash budget every term. For the last term of the year 2009,
the accounting and financial departments of the company provided the following information;
Sales and purchases forecast in amounts tax exclusive (VAT at normal rate)
Oct Nov Dec payment conditions
sales 50,600,000 48,400,000 39,600,000 20% immediately by cash and the balance in 30 days
purchases 36,000,000 30,000,000 28,000,000 in 30 days
THE UNIVERSITY OF BAMENDA
FACULTY OF ECONOMICS AND MANAGEMENT SCIENCES
2
nd
Semester C.A Course: Managerial Accounting: ACCT308
Credit Value:
Course Lecturers:
Time: Course Status: Date:
Venue: Instruction:
www.schoolfaqs.net
1. Investment: acquisition of an equipment in October for 10,000,000FCFA excluding tax
payable within the same month.
2. Wages expenditure; 5,000,000FCFA of wages are paid on the last day of each month while
30% of wages are paid within the first 20 days of the following month as expenditures on
wages.
3. Income tax: installment of 1.1% of monthly turnover is paid on or before the 15
th
of the
following month.
Work required:
1) Present the VAT budget.
2) Present the cash receipts Budget
3) Present the cash disbursement budget
4) Present the cash budget
www.schoolfaqs.net
