Advanced management accounting. Advanced management accounting. ASB 3507 Assignment
Pingit plc produces components which it sells to the shipping industry. Mr. Hannah,
the managing director, is always looking for ways to control the costs and improve
performance .
Pingit plc recorded the following actual results for Product Savynav for the last month:
Product Savvy
2,100 units produced and sold for £14.50 per unit
Direct material L10
1,050 kg costing £1,680
Direct material L17
1,470 kg costing £2,793
Direct labour
525 hours costing £3,675
Variable production overhead
£1,260
Fixed production overhead
£4,725
Standard selling price and cost data for one unit of Product Savynav is as follows.
Selling price
Direct material L10
Direct material L17
Direct labour
14 minutes at £7.20 per direct labour hour
Variable production overhead
£2.10 per direct labour hour
Fixed production overhead
£9.00 per direct labour hour
At the start of the last month, 2,130 units of Product Savvy were budgeted to be produced . No stocks of raw materials are held. All production of Product Savvy is sold immediately to a single customer under a just-in-time agreement.
Required:
Prepare an reconciliation statement that reconciles budgeted profit with actual profit for Product Savvy for the last month. You should calculate variances in as much detail as allowed by the information provided. (40%)
Discuss how the operating statement you have produced can assist managers in
controlling costs and how this may differ for variable production costs from fixed production costs. (25%)
Mr.Hannah has recently heard about Activity Based Costing (ABC) but is unsure what it is and whether Pingit plc could adopt this. You, as the new management accountant, have been asked to provideMr.Hannah with information on ABC, so that he can make a decision whether to introduce it into the company. Your answer should include an explanation of ABC, what the method is intended to do, a comparison with the traditional method and whether it would affect your calculations in part (a). (You do not need to recalculate part (a)). (35%)
p(7)
Place your order now to enjoy great discounts on this or a similar topic.
People choose us because we provide:
Essays written from scratch, 100% original,
Delivery within deadlines,
Competitive prices and excellent quality,
24/7 customer support,
Priority on their privacy,
Unlimited free revisions upon request, and
Plagiarism free work,
Advanced management accounting
Advanced management accounting
For a custom paper on the above or a related topic or instructions, place your order now!
What We Offer:
• Affordable Rates – (15 – 30% Discount on all orders above $50)
• 100% Free from Plagiarism
• Masters & Ph.D. Level Writers
• Money Back Guarantee
• 100% Privacy and Confidentiality
• Unlimited Revisions at no Extra Charges
• Guaranteed High-Quality Content
