A. Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3,000 units during the year. These camping tents sell for RM150 each. BSB had 500 units in finished goods inventory at the beginning of the year.At the end of the year.there were 800 units in finished goods inventory. The following information was supplied by its accountant: Direct labour cost Purchases of raw materials Depreciation of machinery Insurance expenses Factory rent Factory supervision Utilities expenses Indirect labour cost Administration salaries Sales Commission Advertising Materials inventory, May 1 Work in process inventory, May 1 Finished goods inventory, May 1 Materials inventory, May 31 Work in process inventory, May 31 Finished goods inventory, May 31 RM 10,500 15,000 1,000 4.500 2,000 3,000 2,500 3.500 15,000 12.000 20,000 6,000 12,000 2.100 8,000 7,000 800 Additional information: Only 70% of the utilities expense and 80% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities. Required: a) Compute prime cost, manufacturing cost and cost of goods manufactured. b) Compute cost of goods sold. c) Prepare an income statement.

A. Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3,000 units during the year. These camping tents sell for RM150 each. BSB had 500 units in finished goods inventory at the beginning of the year.At the end of the year.there were 800 units in finished goods inventory. The following information was supplied by its accountant: Direct labour cost Purchases of raw materials Depreciation of machinery Insurance expenses Factory rent Factory supervision Utilities expenses Indirect labour cost Administration salaries Sales Commission Advertising Materials inventory, May 1 Work in process inventory, May 1 Finished goods inventory, May 1 Materials inventory, May 31 Work in process inventory, May 31 Finished goods inventory, May 31 RM 10,500 15,000 1,000 4.500 2,000 3,000 2,500 3.500 15,000 12.000 20,000 6,000 12,000 2.100 8,000 7,000 800 Additional information: Only 70% of the utilities expense and 80% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities. Required: a) Compute prime cost, manufacturing cost and cost of goods manufactured. b) Compute cost of goods sold. c) Prepare an income statement.

Name: Question 3A. Bonika Sdn Bhd (BSB) manufactures small camping tents. B
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Description: Question 3A. Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3.000 units during the year.These camping tents sell for RM150 each. BSB had 500 units in finished goods inventory at thebeginning of the year.At the end of the year.th

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Process Costing

Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure. 

Job Costing

Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.

ABC Costing

Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.

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