Please view explanation and answer below.Assignment (2)Deadline: Saturday 06/11/2021 @ 23:59Course Name: Cost AccountingStudent’s Name:Course Code: ACCT 301Student’s ID Number:Semester: 1stCRN:Academic Year: 1443 HFor Instructor’s Use onlyInstructor’s Name:Students’ Grade:/5Level of Marks: High/Middle/LowInstructions – PLEASE READ THEM CAREFULLY•The Assignment must be submitted on Blackboard (WORD format only) viaallocated folder.•Assignments submitted through email will not be accepted.•Students are advised to make their work clear and well presented, marks may bereduced for poor presentation. This includes filling your information on the coverpage.•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 orother resources without proper referencing will result in ZERO marks. Noexceptions.•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.Assignment Question(s):(Marks 5)Q1. What types of companies use job costing? How are overhead allocation rates determinedby these companies? Explain and analyze your answer by providing examples of two Saudicompanies that use job costing.(1.5Mark)Answer:Some of the companies that use job costing include those industry like law firms, accounts andauditing companies, private investment companies and consultancy companies. Examples includeAl Tamimi & Company Al-Khobar Law Firm and AFS Auditing Firm. These companies determineoverheads by adding substracting job cost from direct material and direct labor. The total cost of alljobs finished in a given year is the cost of goods sold in that fiscal year. Al Tamimi & Company AlKhobar Law Firm uses the allocation base to determine its oveheads. In this approach, the costaccountant a predetermined cost as a foundation for allocating unknown costs like labor for eachservice and assumes that the labor hour is proportional to the service as oveheads. In contrast, theAFS Auditing Firm uses the allocation rate method, which involves determining an allocation baseand apportioning overheads to diffrent cost products based on their consumption. An example is theuse of a ratio, 1:2:3 for rent expenses, direct labor and indirect labor.Q2. Axel Ltd. uses a process costing system for its sole processing department. There were16,000 units in beginning WIP inventory for March and 144,000 units were started in March.The beginning WIP units were 70% complete and the 13,000 units in ending WIP were 50%complete. All materials are added at the start of processing.Mark)Required:a) Compute the no. of units started & completed.Number of units started and units completed is give as:Units started in March- ending WIP144,000-13,000=131,000b) Compute the EUP for DM and CC using FIFO and WA methods.(2EUP for DM FIFIO costing EUP for DM is calculated by multiplying WIP units by remaining percentage atthe start of each period since the completed percentage is utilized in previous period. Since directmaterial are added at the beginning of the process, the WIP will be multiplied by zero. Therefore, theWIP for EUP are:EUP for DM in FIFO is the weighted average of the unit started and completed, units transferred(beginning work in progress) and units transferred out and ending WIP compete.Units started and completed 131,000Units transferred out =(16,000 x70/100) =11200131,000-11,200 = 119,800Ending WIP is 13,000 x 50/100= 65000Weighted average 100(131,000) +100(119,800) +100(6500)=13,100,000+ 11,980,000+650,000/ (131,000+119,800+6500)=54.139Therefore, EUP for DM in FIFO is 54.139.Conversion CostEUP for CC is the weighted average of started and completed units, units transferred out -(beginningWIP units) x 100Started and completed units= 131,000Units transferred out (16,000 x70/100) =11200Beginning WIP: 144,000 x70/100=100,800Weighted Average: 100(144,000) +100(11200) +131,000(100)/144,000+11200+131,000=144,00000+1120000+13100000156,600=SAR18334c) Calculate total manufacturing cost/EUP under both methods, if following details areavailable:FIFOWADirect Material CostSAR 648,000SAR 800,000Conversion CostSAR 853,800SAR 1,151,250Answer:Units transferred out =(16,000 x70/100) =11200131,000-11,200 = 119,800EUP =Units completed and transferred out X Direct material cost + Units completed and transferred out xConversion cost= 119,800 x SAR 648,000 + (119,800 x SAR 853,800)110,048,280,000Q3. How are activities identified in an organization and the process of assignment of cost isused under Activity Based Costing (ABC) system? Explain. Support your answer withnumericalexamples.(1.5 Mark)Answer:Activities of an organization are used to allocate overhead costs like direct and indirect labor, costof law material, machine hour and other costs and their respective contribution to manufacturing. Eachactivity cost is categorized as either fixed or variable and is assigned to a category cost. The approach canhelp an organization determine its activity-based cost per unit using the formula:Total activity cost/Total number of units for activity. For example, the activity base in this assignment canbe give as:Total activity cost: 110,048,280,000Total number of units for activity: 119,800Total activity cost=110,048,280,000/119,800=918600Please view explanation and answer below.Assignment (2)Deadline: Saturday 06/11/2021 @ 23:59Course Name: Cost AccountingCourse Code: ACCT 301Semester: 1stStudent’s Name:Student’s ID Number:CRN:Academic Year: 1443 HFor Instructor’s Use onlyInstructor’s Name:Students’ Grade:/5Level of Marks: High/Middle/LowInstructions – PLEASE READ THEM CAREFULLYThe Assignment must be submitted on Blackboard (WORD format only) via allocatedfolder.Assignments submitted through email will not be accepted.Students are advised to make their work clear and well presented, marks may be reducedfor 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 orother 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. Nopictures containing text will be accepted and will be considered plagiarism.Submissions without this cover page will NOT be accepted.Assignment Question(s):(Marks 5)Q1. What types of companies use job costing? How are overhead allocation ratesdetermined by these companies? Exp…
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