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Submission Guidelines 1. the document to be typed using 1.5 spacing justified 2. use Ariel font size 11 3. display a 2.5 cm margin for all sides 4. include page number 5. your word document should...

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Submission Guidelines 1. the document to be typed using 1.5 spacing justified 2. use Ariel font size 11 3. display a 2.5 cm margin for all sides 4. include page number 5. your word document should include the Student ID, Student name and Campus Word Limit and Time Limit 2000 words (maximum) Late submission Unless an extension is granted, essays/assignments submitted after the due date will incur a 5% per calendar day penalty based on the maximum marks available for that assessment task. This penalty will run up to a maximum of 15%. Assessment tasks received more than three calendar days after the due or extended date will not be allocated a mark. Note: The 5% penalty will be incurred for each whole or part of a calendar day that the work is overdue. For extension of time for assessments, please go to the Assessment and Assignment Forms page of the ACU website. Timely submission is critical. Topics: Question 1- Week 4,5,6,7 Job costing, Process Costing and Activity based Costing Question 2 -Week 8-Budgeting ACCT204 Assessment 3 Page 2 of 5 Semester 1,2020 PART ONE Question 1 Visit the following websites of three organisations. Required: (a) From the information provided in the website and its most recent annual report, determine the costing system the organisation is most likely to be used. (3 marks) (b) Explain why you think that costing system is most logical (Hint: observe its main activity/activities, type of inventory accounts etc) (6 marks) (c) Explain the benefits to be gained from using the costing system mentioned in (a) above. (6 marks) (d) Discuss the ethical issues in the use of costing system you have selected (Hint: what elements of these systems require judgement or choice by management and therefore leave open the possibility of manipulation) (3 marks) Use the following table to answer above question. QUESTION ENTIRE EXXON MOBIL MONASH a.Costing system most likely to be used b. Why c. Benefits gained d. Ethical issues ACCT204 Assessment 3 Page 3 of 5 Semester 1,2020 PART TWO Question 2 You are the accountant for Bellyful Restaurant. Following are assumptions about sales for the coming month. • Bellyful Restaurant offers three basic meals: noodle bowls, egg rolls, and rice bowls. • Each meal can be prepared with several different meats or with vegetables only. • Costs and prices are similar for all varieties of each meal. • Prices for noodles bowls are $4 each, egg rolls are $3 each, and rice bowls are $3.50 each. Estimated sales for the next month are 200 noodle bowls, 100 egg roll meals, and 500 rice bowls per day. PART 1: Revenues budget Required: (a) Prepare a revenue budget for the next month assuming it is 30 days long. (3 marks) (b) Discuss two (2) factors that affect the budgeted volumes of meals. (2 marks) PART 2: Direct materials budget The owner of Bellyful Restaurant studied the cost of direct materials for each type of meal. He estimates that noodle bowls use about $1 in direct materials, egg rolls use about $0.75, and rice bowls use about $0.90. Food is purchased daily to ensure high quality. Beginning and ending inventory amounts are minimal. Required: (a) Prepare a direct materials usage budget and a direct materials purchases budget. (4 marks) (b) Discuss reasons why actual costs might be different from budgeted costs in part (b). (2 marks) (c) Suppose the prices of food ingredients increase. Identify possible ways the owner could keep food costs within the budget. Discuss drawbacks for each of your ideas. (2 marks) ACCT204 Assessment 3 Page 4 of 5 Semester 1,2020 PART 3: Direct labour budget The owner of Bellyful Restaurant employs cooks and cashiers. The cashiers take orders and collect payment, transfer food from the cooks to customers, and clean tables. Cooks are paid $10 per hour, and cashiers are paid $8 per hour. Bellyful Restaurant operates four shifts: 10 to 2, 11 to 2, 2 to 10, and 5 to 8. Weekdays and weekends are staffed similarly. Following are the shifts and required workers. Required: (a) Prepare a labour budget showing hours and costs for a month. (Assume 30 days per month.) (4 marks) (b) Discuss reasons why actual labour costs might turn out to be different from budgeted costs in part (a). (2 marks) (c) Identify possible ways the owner could reduce labour costs. Discuss possible drawbacks for each of your ideas. (2 marks) PART 4: Overhead budget Bellyful Restaurant does not separately account for production versus general overhead. Fixed overhead includes production overhead as well as support services and general administration. Variable overhead includes labour-related costs such as payroll taxes and employee benefits. Bellyful Restaurant has estimated variable overhead costs as $2.50 per direct labour hour. Following are the estimated fixed overhead costs for one month: Required: (a) Prepare an overhead costs budget for one month. (3 marks) ACCT204 Assessment 3 Page 5 of 5 Semester 1,2020 (b) Identify possible ways the owner could reduce overhead costs. Discuss possible drawbacks for each of your ideas. (2 marks) PART 5: Budgeted statement of profit or loss Refer to the information from the preceding budgets. The income statement for Bellyful Restaurant consists of revenues less direct costs (direct materials and direct labour) to determine the gross margin. Then the overhead costs are deducted to determine operating income. Required: (a) Prepare a budgeted income statement ignoring income taxes. (4 marks) (b) Bellyful Restaurant’s owner would like to increase profits from the store. Suggest several possible ways to accomplish this goal. Explain your reasoning. (2 marks)
Answered Same Day Jun 01, 2021 ACCT204 Australian Catholic University


Pranjal answered on Jun 02 2021
129 Votes
Table of Contents
1.0 Part One: Question One    3
2.0 Part Two: Question Two    5
2.1 PART 1: Revenues budget    5
2.2 PART 2: Direct materials budget    5
2.3 PART 3: Direct labour budget    6
2.4 PART 4: Overhead budget    7
2.5 PART 5: Budgeted statement of profit or loss    7
References    9
1.0 Part One: Question One
    Costing system most likely to be used
    The business is of construction of infrastructure etc and hence one standalone project may yield considerable revenue for the firm. Moreover, the criticality of the project is severe and hence, the project costing may be used in the given scenario (Entire, 2020).
    The company is an oil and natural gas organisation that is involved in the process of exploration and extraction of oil and gas across the world. The company seems to be using the traditional costing method where the indirect costs are apportioned based on the labour hours etc (Mobil, 2020).
    The business is an educational organisation and hence belongs to the service industry. Therefore, the service costing may be used in the given University to set the fees, identify the costs and prepare the budgets and projections (Monash, 2020).
    As stated earlier, since the construction projects are standalone and involve a separate set of resources, teams, deliverables, strategies and time frame, every project is undertaken accordingly. Hence, the costing has also been tweaked to suit the need of the project. In other words, project costing is best suited for constructions and engineering projects.
    It seems that the oils and natural gas companies are involved in extraction and transportation of oil etc. Since the activities are manifold ranging from extraction to final distribution, the huge supply chain deals with different activities. Traditional costing helps the business to allocate different related overheads costs to the products in the most reasonable manner.
    Since the organisation is an education institution (i.e. a University), the cost components will be different from that of the goods and products-oriented costing method. Service costing enables the management to devise cost structure and fix the price in service sector scenario efficiently. Hence, service costing seems to appropriate here,
    Benefits gained
    Project costing helps the management to appropriately identify cost components, allocate the overheads and assign the price of each project.
    Traditional costing method helps the business to allocate cots to the products in the most simplistic manner. Moreover, the method is accepted as per Generally Accepted Accounting Principles (GAAP).
    Service costing helps the business to identify various cost factors that may affect the overall operations and allocate the same to the service and fix the price accordingly (Dütting, Feldman, Kesselheim and Lucier, 2017, October).
    Ethical issues
    Since the project costing assumes completion percentage based on the certain parameter, reality may differ and hence completion-based costing may not be tenable at times.
    Traditional costing assumes single overhead absorption rate which may not be able to portray the accurate costing structure of the business.
    Service costing assumes all cost components to be related to the service delivery and hence assign the cost of them to the services which may not be true at times. There may be certain redundant service cost.
Table 1: Summary of Findings
(Source: Created by the author)
2.0 Part Two: Question Two
2.1 PART 1: Revenues budget
The revenue budget has been prepared based on the given information pertaining to selling price per unit of three different products namely Noodle Bowls, Egg...

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