Question Tag: Cost Calculation

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ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation

Calculates the cost per unit for both low and high day-rate incentive schemes.

Question

Amanda LTD – Day-Rate Incentive Scheme
Amanda LTD is a manufacturing company and its management is considering the introduction of a high day-rate incentive scheme. During one of such production periods, record shows that, if an employee makes 100 units in a 40-hour week, the employee is paid GH¢2 per hour, but if 120 units are made, the employee is paid GH¢2.50 per hour. Production overhead is added to cost at the rate of GH¢2 per direct labour hour.

Required:
i) What is the cost per unit for the low day-rate scheme?
ii) What is the cost per unit for the high day-rate scheme?

Answer

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Tags: Cost Calculation, Day Rate Scheme, Incentive Scheme
Level: Level 1

Topic: Marginal Costing and Absorption Costing
Series: Nov 2024

QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance

Determine the cost of calculators and books using a system of linear equations and solve for individual costs.

Question

The cost of purchasing 8 calculators and 10 books is 158 (thousands of naira).
At another instance, the cost of purchasing 15 calculators and 3 books is 123 (thousands of naira).

Required:
i. Use the information above to write down a system of linear equations to describe the given cost scenario. (4 Marks)
ii. Solve the resulting system of equations. (4 Marks)
iii. Find the cost of each calculator and each book. (2 Marks)

Answer

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Tags: Cost Calculation, Linear Equations, Simultaneous Equations
Level: Level 1

Topic: Mathematics of Business Finance
Series: NOV 2014

QTB – May 2017 – L1 – SB – Q6a – Statistics

Calculate the monthly cost of replacing diodes based on failure probability and determine if a student can buy a gown based on expected money.

Question

i. The laptops that are purchased by a company have 742 diodes with a life span of five months. These diodes fail on a regular basis according to the following probability distribution:

Life (months)	1	2	3	4	5
Probability of failure	0.10	0.30	0.35	0.20	0.05

If the cost of replacing a diode is ₦100, calculate the monthly cost of replacing the diodes as they fail. (4 Marks)

ii. Tadet, a student in the Accountancy Department of a Polytechnic, has the following chances of receiving money from her relatives:

45% chance of receiving ₦5,000 from her sister,
33% chance of receiving ₦8,000 from her brother,
16% chance of receiving ₦11,000 from her aunt,
6% chance of receiving ₦15,000 from her uncle.

Determine if Tadet will be able to buy a gown worth ₦8,000 from the money she is expecting from her relatives. (6 Marks)

Answer

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Tags: Cost Calculation, Expected Value, Financial planning, Probability Distribution
Level: Level 1

Topic: Statistics
Series: MAY 2017

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

Question

The following is given in relation to raw materials:

O = Opening Inventory
P = Purchases
R = Purchases returns
C = Carriage
E = Excise duties
I = Import duties
Z = Closing Inventory

The cost of raw materials available for use is:

A. O + P + C
B. O + P + E + C – Z
C. O + P + C + I – R
D. O + P + C + R – Z
E. O + P + C – R

Answer

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Tags: Cost Calculation, Inventory, Raw Materials
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2012

FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)

This question tests ability to calculate the value of goods transferred to the Sales Department in a manufacturing context.

Question

Fidelis Textile Mills transfers manufactured products to the Sales Department at cost plus 20%. The following production costs were given to you:

N Prime cost 25,000 Production overhead 8,000 Opening inventory of WIP 2,000 Closing inventory of WIP 3,000

Calculate the value of goods transferred to the Sales Department during the period.

Answer

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Tags: Cost Calculation, Inventory Valuation, Manufacturing Costs
Level: Level 1

Topic: Accounting for Inventories (IAS 2)
Series: MAY 2014

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

Question

Ebuka and Sons Enterprises is a manufacturing business entity that imports some of its raw materials from overseas. The business recently took delivery of some materials as detailed below:

2,000kg of materials at ₦625 per kg subject to a trade discount of 5%.
Import duties and other non-recoverable taxes paid amounted to ₦266,000.
A 3% early payment discount allowance enjoyed by the enterprise amounted to ₦37,500.
Delivery cost on materials imported from the custom warehouse to the production plant is ₦125,000.
3,500kg of local materials at ₦250 per kg subject to a trade discount of ₦50,000.
Carriage inwards on local materials purchased was ₦205,000.
Special toll fare paid to the commodity board for local materials purchased was ₦25,000.

Required:
i. Calculate the total cost of inventory of raw materials. (3 Marks)
ii. It is estimated that these materials can produce 5,000 units of the finished product. Calculate the material cost per unit of the finished product. (2 Marks)

Answer

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Tags: Cost Calculation, Inventory Valuation, Raw Materials, Trade Discount
Level: Level 1

Topic: Inventory
Series: NOV 2021

MI – May 2023 – L1 – SA – Q9 – Costing Techniques

This question asks for the calculation of the machine hour rate based on given data.

Question

Where machine hours is 7,200 hours, machine set-up time allowed is 720 hours and works overhead is ₦32,400. What is the machine hour rate?
A. ₦2
B. ₦3
C. ₦4
D. ₦5
E. ₦6

Answer

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Tags: Cost Calculation, Machine Hour Rate, Overhead Allocation

Topic: Costing Techniques
Series: MAY 2023

MA – Nov 2016 – L2 – Q2a – Budgetary control

Calculate the overhead absorption rates and determine the total costs and selling price of a specific job in a manufacturing company.

Question

Smooth Sailing Ltd is a medium-sized company that specializes in the construction of iron gates for clients. It has three production departments through which all jobs are processed: Assembling, Welding, and Finishing. The following data relates to the year ended 30 September 2015:

Budgeted Data:

	Assembling	Welding	Finishing
Overheads (GH¢)	64,050	108,900	83,520
Direct labour hours	–	–	14,400
Machine hours	5,250	6,600	–

Job CA2 was undertaken during the last month of the year recording the following:

Direct materials:

From stores: GH¢16,500
Bought-in: GH¢12,600

Direct labour:

Assembling: 450 hours @ GH¢8/hr
Welding: 535 hours @ GH¢8/hr
Finishing: 1,235 hours @ GH¢6/hr

Machine hours:

Assembling: 425
Welding: 532
Finishing: –

Trials and testing cost of GH¢5,400 is incurred on each job.

It is company policy to make a mark-up of 50% of profit on each job.

Required:

i) Calculate an appropriate overhead absorption rate for each department for the year ended 30 September 2015. (5 marks)

ii) Determine the total costs, and hence, the price of Job CA2. (10 marks)

Answer

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Tags: Cost Calculation, Job Costing, Labour Hours, Machine Hours, Overhead Absorption Rate, Pricing
Level: Level 2

Topic: Budgetary control
Series: NOV 2016

ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation

Calculates the cost per unit for both low and high day-rate incentive schemes.

Question

Required:
i) What is the cost per unit for the low day-rate scheme?
ii) What is the cost per unit for the high day-rate scheme?

Answer

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Tags: Cost Calculation, Day Rate Scheme, Incentive Scheme
Level: Level 1

Topic: Marginal Costing and Absorption Costing
Series: Nov 2024

QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance

Determine the cost of calculators and books using a system of linear equations and solve for individual costs.

Question

The cost of purchasing 8 calculators and 10 books is 158 (thousands of naira).
At another instance, the cost of purchasing 15 calculators and 3 books is 123 (thousands of naira).

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Linear Equations, Simultaneous Equations
Level: Level 1

Topic: Mathematics of Business Finance
Series: NOV 2014

QTB – May 2017 – L1 – SB – Q6a – Statistics

Calculate the monthly cost of replacing diodes based on failure probability and determine if a student can buy a gown based on expected money.

Question

i. The laptops that are purchased by a company have 742 diodes with a life span of five months. These diodes fail on a regular basis according to the following probability distribution:

Life (months)	1	2	3	4	5
Probability of failure	0.10	0.30	0.35	0.20	0.05

If the cost of replacing a diode is ₦100, calculate the monthly cost of replacing the diodes as they fail. (4 Marks)

ii. Tadet, a student in the Accountancy Department of a Polytechnic, has the following chances of receiving money from her relatives:

45% chance of receiving ₦5,000 from her sister,
33% chance of receiving ₦8,000 from her brother,
16% chance of receiving ₦11,000 from her aunt,
6% chance of receiving ₦15,000 from her uncle.

Determine if Tadet will be able to buy a gown worth ₦8,000 from the money she is expecting from her relatives. (6 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Expected Value, Financial planning, Probability Distribution
Level: Level 1

Topic: Statistics
Series: MAY 2017

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

Question

The following is given in relation to raw materials:

O = Opening Inventory
P = Purchases
R = Purchases returns
C = Carriage
E = Excise duties
I = Import duties
Z = Closing Inventory

The cost of raw materials available for use is:

A. O + P + C
B. O + P + E + C – Z
C. O + P + C + I – R
D. O + P + C + R – Z
E. O + P + C – R

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Inventory, Raw Materials
Level: Level 1

Topic: Financial Statements Preparation
Series: NOV 2012

FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)

This question tests ability to calculate the value of goods transferred to the Sales Department in a manufacturing context.

Question

Fidelis Textile Mills transfers manufactured products to the Sales Department at cost plus 20%. The following production costs were given to you:

N Prime cost 25,000 Production overhead 8,000 Opening inventory of WIP 2,000 Closing inventory of WIP 3,000

Calculate the value of goods transferred to the Sales Department during the period.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Inventory Valuation, Manufacturing Costs
Level: Level 1

Topic: Accounting for Inventories (IAS 2)
Series: MAY 2014

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

Question

Ebuka and Sons Enterprises is a manufacturing business entity that imports some of its raw materials from overseas. The business recently took delivery of some materials as detailed below:

2,000kg of materials at ₦625 per kg subject to a trade discount of 5%.
Import duties and other non-recoverable taxes paid amounted to ₦266,000.
A 3% early payment discount allowance enjoyed by the enterprise amounted to ₦37,500.
Delivery cost on materials imported from the custom warehouse to the production plant is ₦125,000.
3,500kg of local materials at ₦250 per kg subject to a trade discount of ₦50,000.
Carriage inwards on local materials purchased was ₦205,000.
Special toll fare paid to the commodity board for local materials purchased was ₦25,000.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Inventory Valuation, Raw Materials, Trade Discount
Level: Level 1

Topic: Inventory
Series: NOV 2021

MI – May 2023 – L1 – SA – Q9 – Costing Techniques

This question asks for the calculation of the machine hour rate based on given data.

Question

Where machine hours is 7,200 hours, machine set-up time allowed is 720 hours and works overhead is ₦32,400. What is the machine hour rate?
A. ₦2
B. ₦3
C. ₦4
D. ₦5
E. ₦6

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Machine Hour Rate, Overhead Allocation

Topic: Costing Techniques
Series: MAY 2023

MA – Nov 2016 – L2 – Q2a – Budgetary control

Calculate the overhead absorption rates and determine the total costs and selling price of a specific job in a manufacturing company.

Question

Budgeted Data:

	Assembling	Welding	Finishing
Overheads (GH¢)	64,050	108,900	83,520
Direct labour hours	–	–	14,400
Machine hours	5,250	6,600	–

Job CA2 was undertaken during the last month of the year recording the following:

Direct materials:

From stores: GH¢16,500
Bought-in: GH¢12,600

Direct labour:

Assembling: 450 hours @ GH¢8/hr
Welding: 535 hours @ GH¢8/hr
Finishing: 1,235 hours @ GH¢6/hr

Machine hours:

Assembling: 425
Welding: 532
Finishing: –

Trials and testing cost of GH¢5,400 is incurred on each job.

It is company policy to make a mark-up of 50% of profit on each job.

Required:

i) Calculate an appropriate overhead absorption rate for each department for the year ended 30 September 2015. (5 marks)

ii) Determine the total costs, and hence, the price of Job CA2. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Calculation, Job Costing, Labour Hours, Machine Hours, Overhead Absorption Rate, Pricing
Level: Level 2

Topic: Budgetary control
Series: NOV 2016

Question Tag: Cost Calculation

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ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation

Calculates the cost per unit for both low and high day-rate incentive schemes.

You're reporting an error for "ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation"

QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance

Determine the cost of calculators and books using a system of linear equations and solve for individual costs.

You're reporting an error for "QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance"

QTB – May 2017 – L1 – SB – Q6a – Statistics

Calculate the monthly cost of replacing diodes based on failure probability and determine if a student can buy a gown based on expected money.

You're reporting an error for "QTB – May 2017 – L1 – SB – Q6a – Statistics"

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

You're reporting an error for "FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation"

FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)

This question tests ability to calculate the value of goods transferred to the Sales Department in a manufacturing context.

You're reporting an error for "FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)"

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

You're reporting an error for "FA – Nov 2021 – L1 – SB – Q5d – Inventory"

MI – May 2023 – L1 – SA – Q9 – Costing Techniques

This question asks for the calculation of the machine hour rate based on given data.

You're reporting an error for "MI – May 2023 – L1 – SA – Q9 – Costing Techniques"

MA – Nov 2016 – L2 – Q2a – Budgetary control

Calculate the overhead absorption rates and determine the total costs and selling price of a specific job in a manufacturing company.

You're reporting an error for "MA – Nov 2016 – L2 – Q2a – Budgetary control"

ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation

Calculates the cost per unit for both low and high day-rate incentive schemes.

You're reporting an error for "ICMA – Nov 2024 – L1 – Q4b – Day-Rate Incentive Scheme Calculation"

QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance

Determine the cost of calculators and books using a system of linear equations and solve for individual costs.

You're reporting an error for "QTB – Nov 2014 – L1 – SB – Q1a – Mathematics of Business Finance"

QTB – May 2017 – L1 – SB – Q6a – Statistics

Calculate the monthly cost of replacing diodes based on failure probability and determine if a student can buy a gown based on expected money.

You're reporting an error for "QTB – May 2017 – L1 – SB – Q6a – Statistics"

FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation

Determining the formula for calculating the cost of raw materials available for use.

You're reporting an error for "FA – Nov 2012 – L1 – SA – Q17 – Financial Statements Preparation"

FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)

This question tests ability to calculate the value of goods transferred to the Sales Department in a manufacturing context.

You're reporting an error for "FA – May 2014 – L1 – SA – Q16 – Accounting for Inventories (IAS 2)"

FA – Nov 2021 – L1 – SB – Q5d – Inventory

This question involves calculating the total cost of raw materials and determining the cost per unit for a finished product.

You're reporting an error for "FA – Nov 2021 – L1 – SB – Q5d – Inventory"

MI – May 2023 – L1 – SA – Q9 – Costing Techniques

This question asks for the calculation of the machine hour rate based on given data.

You're reporting an error for "MI – May 2023 – L1 – SA – Q9 – Costing Techniques"

MA – Nov 2016 – L2 – Q2a – Budgetary control

Calculate the overhead absorption rates and determine the total costs and selling price of a specific job in a manufacturing company.

You're reporting an error for "MA – Nov 2016 – L2 – Q2a – Budgetary control"

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