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HIGHER COLLEGE OF TECHNOLOGY DEPARTMENT: BUSINESS STUDIES Final Examination Assignment Based Assessment Semester: II A. Y.: 2019 / 2020 Diploma: II Year Start Date: 04.06.2020 Time: 9:00 AM Due Date: 06.06.2020 Time: 9:00 AM Student Name Student ID Specialization Accounting Section Level Diploma II Year Course Name MANAGEMENT ACCOUNTING 1 Course Code BAAC2204 For official Use Only Question No. Max. Marks Obtained Marks Question No. Max. Marks Obtained Marks CS 1 - Q1 5 CS 1 - Q1 5 CS 1 - Q2 5 CS 1 - Q2 5 CS 2 - Q1 5 CS 2 - Q1 5 CS 2 - Q2 5 CS 2 - Q2 5 CS 2 - Q3 5 CS 2 - Q3 5 CS 3 - Q1 5 CS 3 - Q1 5 CS 4 - Q1 10 CS 4 - Q1 10 CS 5 - Q1 4 CS 5 - Q1 4 CS 5 - Q2 4 CS 5 - Q2 4 CS 5 - Q3 2 CS 5 - Q3 2 Grand Total Marks 50 50 First Marker: Second Marker: Date: Date:

Guidelines for Students to Submit the Assignment: 1) The final assessment for semester 2, 2019-20 will be done through comprehensive assignment for a maximum of 50 marks. The schedule of the final assessment is available in the college website. https://www.hct.edu.om/about/the-college/announcements/final-assessment-timetable- 041620 2) All the students are expected to have only one assignment at one time. In case, if the students have more than one assignment on the same day, please report to the exam committee through the following mail id. exam.bus@hct.edu.om as soon as possible. 3) All students are given 48 hours to complete and submit each assignment from the day, date and time the assignment is uploaded. Students are advised not to wait till the last moment of the deadline to submit the assignment. 4) The students can check the assignment anytime and any number of times from the opening of the assignment. The answer to the assignment needs to be uploaded in e- learning within 48 hours. 5) The answer to the assignment can be uploaded only one time. No requests for resubmission of the assignment will be entertained. 6) The students may contact the following mail Ids if they face any difficulties while related to final assignment. For Academic related support : Business Courses     For Technical Writing 1   For Technical Writing 2   For Technical Communication   anand.kalimani@hct.edu.om karri.krishna@hct.edu.om   ramil-ecot@hct.edu.om   khulood.aiadi@hct.edu.om   jocelyn.balili@hct.edu.om For issues related to e-mail accounts and Microsoft Teams office365support@hct.edu.om Any issues related to E-Learning Moodle support.elearning@hct.edu.om Any other IT Troubleshooting helpdesk2@hct.edu.om

Case Study 1 The management in Unilever plant in Ontario is preparing for a change. The company plans to improve energy efficiency to help manage the rising and unpredictable energy prices. The plant produces margarine and other vegetable oil products. The cost of energy represents 15% of all production costs. The company expects that the cost will increase further in the coming years, as the energy price are expected to increase further. To meet an aggressive goal of reducing energy consumption by at least 6% per year, the plant’s energy team has implemented, and carefully documented, 120 projects since 1999, saving more than $4.2m in costs (based on 2006 prices), and avoiding about 23,000 tons of greenhouse gases. One of the solutions was to invest in new technology – a reverse osmosis (RO) system that would enable significant, measurable improvements in the efficiency of the steam plant operations. In the first year of operation, Unilever calculated that the project would lead to net savings of $378,166 (based on 2006 prices), even after accounting for the full cost of operating and maintaining the RO system. It is expected that the technology will pay for itself in less than 16 months. In order to verify whether the savings by implementing a new technology is significant, the company decided to conduct a research. The objectives of the research were to examine whether reverse osmosis (RO) system is beneficial for companies in the region. It is decided to select a few companies. The list of all companies was available. The management accountant has classified the list into; a) manufacturing, b) extraction and c) other companies. Samples are selected randomly from of these groups. Based on the above case, answer the following questions. Question No. 1 a. Briefly explain the role of management accountant in the above case. (The answer should explain the functions of management accountant. [3 Marks] b. Do financial accountant and cost accountant have a role to support management in the above case? Explain. [2 Marks] Question No. 2 a. What type of information is required for the junior level, middle level and top-level management in the above case, for decision making? [3 Marks] b. Briefly explain the sampling method used in this case study. [2 Marks]

Case Study 2 Gadgets Electronics, LLC is producing four gadgets microphone, headphone, webcam and memory stick. Gadgets Electronics till now applying traditional costing method to determine the total cost and cost per unit of each gadget. Company wants to switch to ABC system in order to understand the accurate performance of each gadget. You have given this job to compare between both costing methods in order to determine which product is more profitable to the company and which one is least. Production detail: - Company produces 10,000 units of headphone; 5,000 units of microphone; 50,000 units of memory sticks and 20,000 units of webcam. Overheads, Activity and Cost Driver Details: - (i) The labour hour per units 0.10 for headphone; 0.15 for microphone; and 0.05 for memory stick and 0.20 for webcam. (ii) The production costs incurred RO 3,800. Number of machines runs 25 times for headphone; 20 times for microphone; 40 times for memory stick and 45 times for webcam. (iii) The assembly costs incurred RO 2,500. Labor on assembly of components 75 hours for headphone; 25 hours for microphone; 50 hours for memory stick; 60 hours for webcam. (iv) The testing costs incurred RO 1,400. The company tested all the units manufactured. (v) The packaging costs incurred RO 1,200. All the gadgets are separately packed. Prime Cost Details: - (i) RO 1.500 per unit on direct materials and RO 1.250 per unit on direct labour paid for headphone. (ii) RO 0.750 per unit on direct materials and RO 0.500 per unit on direct labour paid for microphone. (iii) RO 0.500 per unit on component materials and RO 0.250 per unit on direct labour paid for memory stick. (iv) RO 1.750 per unit on direct materials and RO 1.500 per unit on direct labour paid for webcam.

325,000 320,000 319,000 345,000 365,000 326,500 314,500 The sales reported every month including cash sales and credit sales. Cash sales constitute 40% of total sales collected in the month of sales and the balance is credit sales received in the month following the month of sales. The detail of goods purchased in cash during seven months reported in purchase book as below: - January February March April May June July 26,500 28,500 29,500 27,500 23,500 24,800 22,000 Company also purchased goods on credit from different suppliers. The detail of credit purchase from the month January to July is given below: - January February March April May June July 125,000 111,600 126,500 145,600 132,500 115,000 116,000 Cash purchases payable in the month of purchases and credit purchases are payable to supplier in two months following the month of credit purchase. It is also found from the accounting records that the company has purchased a plant and equipment for RO 22,000 in March and it is payable in two equal instalments starting from April. Tax department has sent a notice to the company to pay taxes of RO 6,750 each in the month of May and June. The wages and office expenses are paid in the month following the month in which wages and office expenses incurred. The detail of wages and office expenses is given below: -   January February March April May June July Wages 2,250 2,200 2,150 2,650 2,350 2,450 2,260 Office Expenses 3,300 3,150 3,250 3,160 3,160 3,280 3,120 The selling expenses of the company recorded for the seven months are as follows: - January February March April May June July 1,250 1,650 1,450 1,680 1,290 1,780 1,500 The company also incurred administrative expenses for the period January to July. The detail of administrative expenses is given as below: -

January February March April May June July 1,600 1,650 1,750 1,650 1,890 1,990 2,020 The company is paying the selling and administration expenses in two months following the month in which such expenses incurred. The cash balance as on 1 st April is RO 47,800. Requirement: The Company has requested you to prepare Cash budget for the period of April to June. [10 Marks] Case Study 5 Sohail Company Ltd. is a wholesaler of building materials in Salalah governorate. Company furnished the following information to measure its performance by using different ratios for the year 2019: - Company started its business with share capital and debts of RO 2,255,000 consisting of 395,000 shares of RO 4.750 each and bonds payable RO 378,750. Company’s assets including building worth RO 275,000, machinery worth RO 145,000, cash available in the office RO 12,500 and at bank 120,500. At the end of 2019, the inventory reported worth RO 98,750. Later in the year company purchased furniture worth of RO 45,800. In the year 2019, company has made the sale of RO 1,325,800 by incurring cost of goods sold RO 795,000 and operating expenses RO 132,500. The income from other sources reported RO 55,700. Company paid interest of RO 14,000 on bonds payable in the year 2019. The total outstanding expenses and accounts payable reported RO 12,800 and RO 84,500 at the end of the year 2019. Company also paid taxes at 15% on net profit. The dividend declared and paid 17.5% on PAT. The market value of the shares at the end of the year RO 6.350 each. Requirements: - Calculate the following ratios: - a. Shareholder’s Ratios by showing all required calculations and formulas. [ 4 Marks] b. Profitability Ratios by showing all required calculations and formulas. [4 Marks] c. Current and Quick Ratio by showing all required calculations and formulas. [2 Marks]