Australia CPA/ACCA, qualified accountant highly preferred to perform the task or Australian Accounting graduates. Applications without a proposal will not be considered.
DUE DATE: 9 October 2014 22:00 GMT (2 days)
Find the attachment for further details.
You are required to finish Part A & B ONLY.
Part A: Completed schedules in Excel
Schedules (5 marks)
Complete Excel schedules in the appropriate spaces on pro-formas. Do not delete any parts of the pro-forma. Show all required working in the relevant spaces, and only show required working.
•Variance report related to units produced. (Schedule 1)
•Calculation of standard costing cost variances relating to the product “Dance”. The firm calculates price variances for all manufacturing costs, efficiency variances for all variable manufacturing costs, and a fixed overhead volume variance. The material price variance is calculated on usage. (Schedule 2)
•The Normal Absorption Costing Income Statement for the period, with relevant variances expensed to the period and; recast the Income Statement (with relevant variances expensed to the period) assuming Standard Absorption Costing. (Schedules 3 and 4, and a schedule to calculate COGS)
•Show the journal entries for the period under the standard absorption costing system currently used by the firm. Journal entries must be presented in proper form. (Schedule 5)
•Prepare a comparison of overhead costs per product under the existing costing system (a plant-wide rate based on DL hours) with an Activity Based Costing system using the cost pools and cost drivers identified in the data. (Schedule 6 and workings for Schedule 6)
PART B: Answers to management questions (pro-forma provided)
(1) The firm’s labour force has a good reputation. Therefore, management is perplexed at the efficiency variances from this period. Taking each of the variances separately under the headings provided in the pro-forma, suggest possible reasons (deriving from the facts provided in the case) that the firm has used more/less material and more/less DL hours than it should have. Your suggested reason(s) may apply to more than one variance so be very clear here. Be concise and succinct. (4 Marks)
(2) Management is uncertain about the meaning of the fixed OH variance. They have commented: “the fixed OH variance is favourable, so this must mean that everything is OK there”. Explain to management the meaning of the variance and why their observation is incorrect. (2 Mark) In addition, following on from that explanation, explain related consequences for the firm in light of the other concerns that management has raised (2 Mark),