ACCT 322 SEU Managerial Accounting Allocations and Overhead Exercises

College of Administrative &Financial Sciences
Assignment (2)
Deadline: Saturday 11/11/2023 @ 23:59
Course Name: Managerial Accounting
Student’s Name:
Course Code: ACCT 322
Student’s ID Number:
Semester: First Term 23/24
CRN: 12014
Academic Year: 1445 H
For Instructor’s Use only
Instructor’s Name: Dr. Youssef RIAHI
Students’ Grade:
/15
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
• The Assignment must be submitted on Blackboard (WORD format only) via allocated
folder.
• Assignments submitted through email will not be accepted.
• Students are advised to make their work clear and well presented, marks may be
reduced for poor presentation. This includes filling your information on the cover
page.
• Students must mention question number clearly in their answer.
• Late submission will NOT be accepted.
• Avoid plagiarism, the work should be in your own words, copying from students or
other resources without proper referencing will result in ZERO marks. No exceptions.
• All answers must be typed using Times New Roman (size 12, double-spaced) font.
No pictures containing text will be accepted and will be considered plagiarism.
• Submissions without this cover page will NOT be accepted.
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College of Administrative &Financial Sciences
Assignment Question(s):
(Marks 15)
Q1. Define in Your words
a. Cost Centre
[0.5 mark]
b. Profit Centre
[0.5 mark]
c. Investment Centre
[0.5 mark]
Answer:
Q2. Hamed Company is preparing budgets for the quarter ending June 30, 2019.
Budgeted sales in units for the next five months are:
April
May
June
July
20,000
50,000
30,000
25,000
Required:
a. Prepare Sales budget for April, May & June assuming selling price per unit is SR 15.
[2.5 marks]
b. Prepare production budget for April, May & June if the company wishes ending inventory as
10 % of next month sales units.
[2.5 marks]
Answer:
Q3. Karim Corporation is considering two alternatives that are code-named A and B. Costs
associated with the alternatives are listed below:
Alternative A
Alternative B
Supplies costs
SAR 33 000
SAR 33 000
Assembly costs
SAR 48 000
SAR 51 000
Power costs
SAR 32 000
SAR 22 000
Inspection costs
SAR 11 000
SAR 27 000
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College of Administrative &Financial Sciences
Required:
a. Which costs are relevant and which are not relevant in the choice between these two alternatives?
[2.5 Marks]
b. What is the differential cost between the two alternatives?
[2.5 Marks]
Answer
Q.4 Karim Industries is a division of a major corporation. Last year the division had total sales of
SAR 43,380,000, net operating income of SAR 4,828,980, and average operating assets of SAR
9,000,000. The company’s minimum required rate of return is 12%.
Required:
a. What is the division’s margin?
[1 mark]
b. What is the division’s turnover?
[1 mark]
c. What is the division’s return on investment (ROI)?
[1.5 marks]
Answer
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