SECTION A: Structured Questions (40 marks)

SECTION A: Structured Questions (40 marks)

This section consists of TWO (2) questions. Answer ALL questions.

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Question 1

Three joint products are produced by a chemical process. There are two consecutive processes. Output from the first process is transferred to next process, from which three joint products, N35, B24 and L27 are produced and sold.

Process 1Material 50,000 kg at RM8 per kg Direct labourOverheadsNormal loss 10% of input Scrap value of loss OutputRM400,000 RM250,000 RM180,000
RM4 per kg 46,000kg

Process 2

Direct labour Overheads Output

RM276,000 RM276,000N35 18,000 kgB24 16,000 kgL27 12,000 kg

There were no opening and closing stocks in either process. The selling prices of the output from Process 1 were as follows:

N35 RM48 per kg

B24 RM36 per kg

L27 RM24 per kg


  1. Prepare an account for Process 1 . [10 marks]
  1. Calculate the total of joint cost. [2.5 marks]
  1. Calculate the profit attributable to each of the joint products by apportioning the total costs from Process 2:

On the basis of weight of output. [7.5 marks]

[Total: 20 marks]

Question 2

Amni run a soft toys shop in Kampar, Perak. Below are the transactions for the month of May 2020.

May 1Beginning Inventory50 units @ RM15.00 each
4Purchases140 units @ RM15.50 each
11Purchases70 units @ RM16 each
26Sales190 units @ RM19.00
Sales30 units @ RM19.50
  1. Calculate the value of ending inventory and the cost of goods sold using perpetual:
  1. First In First Out (FIFO) [5 marks]
  1. Last In First Out (LIFO) [4.5 marks]
  1. Average Method (AVCO) [4.5 marks]
  1. Draw up the statement of profit and loss and other comprehensive income for the year showing the gross profits that have been reported using FIFO, LIFO and AVCO. [6


[Total: 20 marks]

SECTION B: Structured Questions (60 marks)

This section consists of THREE (3) questions.

Answer ALLquestions.

Question 1

Product Beta is produced by passing through two processes: 1 and 2. The following information relates to Process 1 for the month of April 2020. At the start of the period, there were 600 units of opening work in process with a cost to date of RM4,500.

The degree of completion and the costs to date are as follows:

Degree of completionCosts

During the month of April, the following costs were incurred:

2,000 units of direct materialsRM14,800
Direct labourRM7,385
Production overheadRM7,896

At the end of April, it was found that there were 500 units of closing work in process with the following degree of completion:

Degree of completion

There was no loss in the process.

The company operates using the first in first out method of charging opening stock to production.


  1. Prepare the Process 1 Account. [4 marks]
  1. Prepare the statement of equivalent production units and calculate the total equivalent production units in total and by elements of cost. [7 marks]
  1. Prepare the statement of cost and calculate the cost per equivalent units in total and by elements of cost. [3.5


  1. Prepare the statement of valuation and calculate the cost to be transferred to process in total and by elements of cost. [5.5 marks] [Total: 20 marks]

Question 2

  1. Indah Anggun Company has provided the following information regarding its product Alpha for Period 1.
Units produced250,000
Units sold (RM40 per unit)200,000
Budgeted units250,000
Variable cost per unit:RM
Direct materials10
Direct labour7
Variable production overheads5
Variable selling and administrative overheads3
}SECTION A: Structured Questions (40 marks) This section consists of TWO (2) questions. Answer ALL questions.     Question 1     Three joint products are produced by a chemical process. There are two 1

There were no opening stocks at the start of the period 1. It is also noted that the actual and budgeted production overheads are the same.

RM375,000 RM150,000


  1. Prepare the operating statements based on marginal costing principles.

[4.5 marks]

  1. Manufacturing support cost for Bijak Sdn. Bhd. in September 2020 is as follows:
Cost poolNormal cost (RM)
Electricity consumed20,000
Material handling45,000
Machine assembly40,000
Quality inspection20,000

Company’s cost accounting system assigns support cost to product based on machine hours. Estimated total machine hour for September 2020 is 25,000. The Managing Director has requested the accountant to implement an Activity Based Costing (ABC) system because this system is believed to estimate product cost more accurately. The accountant has collected the following data:

Cost poolCost driverExisting capacityCost (RM)
Electricity consumedKilowatt hours10,000 kilowatt20,000
Material handlingMaterial movement2,500 movement45,000
Machine setupNumber of setups500 sets finished40,000
Quality inspectionNumber of inspections1,000 inspections20,000

The company received an order to supply 500 units of a product called M10. The estimated cost and other information that relate with the production of 500 units of M10 are as follows.

Raw material costRM10,000
Direct labour costRM9,000
Machine hour900 machine hours
Direct labour hour1,000 direct labour hours
Electricity consumption1,000 kilowatt hours
Material handling20 movement
Machine set up3 set ups
Quality inspection10 inspections


  1. Define Activity Based Costing (ABC). [3.5 marks]
  1. Calculate the cost per unit for product M10 by using the following methods:
  1. Traditional Costing [2


  1. Activity Based Costing [2


[Total: 12 marks]

Question 3

Bright Lighting Sdn Bhd, an engineering company, has five cost centres: Three production departments, machine shop, welding shop and assembly shop and two service departments, maintenance and power house.

The following are the allocated costs:

Machine Shop(RM)Welding Shop(RM)Assembly Shop (RM)Maintenance (RM)Power house(RM)
Indirect wages400800300250250
Repairs andmaintenance3,0002,5001,5002,0001,000
A pportionment costsRM
Depreciation on equipment10,000
Insurance on equipment1,000

The following basis of apportionment is available.

Direct labour cost(RM)Machine hoursFloor area sq.ftDirect labour hoursEffective horse powerNumber of employeesEquipment value (RM)

It is decided that the cost of the service cost centre should be apportioned as follows:



  1. Prepare an analysis of the overheads using the basis provided above. [25 marks]
  1. Using the direct method, apportion the service cost centre among the production cost centres [3 marks]

[Total: 28 marks]

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