MAF201/TEST2/JAN 2021
SUGGESTED SOLUTION TEST 2 MAF201
COST AND MANAGEMENT ACCOUNTING 1
SEMESTER OCTOBER 2020 - FEBRUARY 2021
QUESTION 1
PART A – TRUE & FALSE
a. True
b. False
PART B – STRUCTURED QUESTION
NO QUESTION ANSWER MARK
Calculate break-even point in units and value
a.
for the year
i. How much is the BEP (in units)? 110,000 bottles 1 mark
ii. How much is the BEP (in RM)? RM825,000 1 mark
iii. How much is the sales unit? 172,800 bottles 1 mark
iv. How much is the MOS (in units)? 62,800 bottles 1 mark
v. How much is the MOS (in RM)? RM471,000 1 mark
New selling price if variable cost increase to
b.
RM5 and maintain at current net profit
i. How much is the current net profit? RM188,400 1 mark
ii. How much is the new selling price? RM8 2 mark
The business purchased new machinery at a
cost of RM125,000 with no residual value and
it is estimated that the machine would last for
c.
five years. Calculate new sales units if the
company wants to achieve a target profit of
RM200,000.
i. How much is depreciation of new machinery? RM25,000 1 mark
ii. How much is new sales units? 185,000 bottles 2 mark
Advise the company whether or not to proceed
d. with the new scented hand sanitizer in terms
of total break-even point and profitability.
How much is the total WACM for the proposal
i. RM2.40 2 mark
1?
How much is the total BEP (in units) for the
ii. 148,750 bottles 1 mark
proposal 1?
How much is the total WACM for the proposal
iii. RM2.50 2 mark
2?
How much is the total BEP (in units) for the
iv. 142,800 bottles 1 mark
proposal 2?
v. Which proposal should be chosen? Proposal 2 1 mark
MAF201/TEST2/JAN 2021
a. i. BEP (in units) = RM330,000√ / (RM7.50 – 4.50) √
= 110,000 bottles
ii. BEP (in RM) = 110,000 bottles√ x RM7.50√
= RM825,000
iii. Sales units = 12,000 x 120%√ x 12 months√
= 172,800 bottles
iv. MOS (units) = 172,800 bottles√ – 110,000 bottles√
= 62,800 bottles
v. MOS (RM) = 62,800 bottles√ x RM7.50√
= RM471,000
(10√ x 0.5 mark each = 5 marks)
b. MOS = Budgeted sales unit – BEP unit
40,000√ = x – 110,000
x = 150,000 bottles√
(2√ x 0.5 mark each = 1 marks)
c. NP = [(RM7.50 – 4.50) x 172,800 bottles]√ - RM330,000√
NP = RM188,400
New VC = RM5
New SP = RM188,400 √ + RM330,000√ + (RM5 x 172,800 bottles) √
172,800 bottles√
New SP = RM8.00
(6√ x 0.5 mark each = 3 marks)
d. Depn. = RM125,000√ / 5 years √
= RM25,000
New TFC = RM330,000 + RM25,000√
= RM355,000
New sales units = RM355,000√ + RM200,000 √
RM3√
MAF201/TEST2/JAN 2021
New sales units = 185,000 bottles.
(6√ x 0.5 mark each = 3 marks)
e. Proposal 1:
Product Selling Variable Contribution Sales Mix WACM
Price Cost Margin
Peppermint 7.50 4.50 3.00 50% 1.50√
Rose 8.50 6.50 2.00 30% 0.60√
Blueberry 7.00 5.50 1.50 20% 0.30√
2.40√
Total BEP (units) = (RM330,000 + RM27,000) √
2.40 √
= 148,750 bottles
Proposal 2:
Product Selling Variable Contribution Sales Mix WACM
Price Cost Margin
Peppermint 7.50 4.50 3.00 55% 1.65√
Rose 8.50 6.50 2.00 35% 0.70√
Blueberry 7.00 5.50 1.50 10% 0.15√
2.50√
Total BEP (units) = (RM330,000 + RM27,000) √
2.50 √
= 142,800 bottles
(12√ x 0.5 mark each = 6 marks)
Seehat Sdn Bhd should choose proposal 2√ because of lower BEP as compared to
proposal 1.
(1√ x 1 mark each = 1 marks)
(Total: 20 marks)
MAF201/TEST2/JAN 2021
QUESTION 2
PART A
1. A
2. C
3. A
4. D
(4 x 2 mark each = 8 marks)
PART B
NO QUESTION ANSWER MARK
.
a. i. How much cash sales collection to be received in May? 32,000 1 mark
ii. How much credit sales collection to be received in May? 136,000 2 mark
iii. How much expected total cash inflows for May? 168,000 1 mark
iv. How much wages to be paid in May? 47,000 1 mark
v. How much expected payment to creditors in May? 25,000 1 mark
vi. How much overhead to be paid in May? 12,000 1 mark
vii. How much sales tax to be paid in May? 9,300 1 mark
viii. How much expected total cash outflows for May? 94,300 1 mark
ix. How much expected closing cash balance for May? 223,700 1 mark
(10 marks)
b. i. How much cash sales collection to be received in June? 33,000 1 mark
ii. How much credit sales collection to be received in June? 124,000 2 mark
iii. How much expected total cash inflows for June? 157,000 1 mark
. iv. How much wages to be paid in June? 50,000 1 mark
v. How much expected payment to creditors in June? 26,000 1 mark
vi. How much overhead to be paid in June? 12,000 1 mark
vii. How much machine instalment to be paid in June? 20,000 1 mark
viii. How much sales tax to be paid in June? 9,600 1 mark
ix. How much expected total cash outflows for June? 168,100 1 mark
x. How much expected closing cash balance for June? 212,600 1 mark
(11 marks)
c. i. How much cash sales collection to be received in July? 28,000 1 mark
ii. How much credit sales collection to be received in July? 128,000 2 mark
iii. How much expected total cash inflows for July? 166,000 1 mark
iv. How much wages to be paid in July? 50,000 1 mark
v. How much expected payment to creditors in July? 26,000 1 mark
vi. How much overhead to be paid in July? 13,500 1 mark
vii. How much machine instalment to be paid in July? 20,000 1 mark
viii. How much sales tax to be paid in July? 9,900 1 mark
ix. How much expected total cash outflows for July? 119,400 1 mark
x. How much expected closing cash balance for July? 259,200 1 mark
(11 marks)
(32 marks)
(Total: 40 marks x ½ = 20 marks)
MAF201/TEST2/JAN 2021
Workings:
CSR Entrepreneur Sdn Bhd
Cash budget for the months of May, June and July 2021
May June July
Balance b/d 150,000 223,700 212,600
Add: Cash Receipt
Cash Sales 20% x Sales Value 32,000√ 33,000√ 28,000√
Credit Sales 80% x Sales Value 136,000√√ 124,000√√ 128,000√√
Dividend received - - 10,000
TOTAL CASH INFLOW 318,000√ 380,700√ 378,600√
Less: Cash Payment
Wages paid 47,000√ 50,000√ 50,000√
Creditor-raw material (1) 25,000√ 26,000√ 26,000√
Overhead 12,000√ 12,000√ 13,500√
Loan - 50,000 -
Machine - 20,000√ 20,000√
Sales tax 9,300√ 9,600√ 9,900√
Property tax 1,000 - -
Donation - 500 -
TOTAL CASH OUTFLOW 94,300√ 168,100√ 119,400√
Closing balance c/d 223,700√ 212,600√ 259,200√
(32√ x 0.5 mark each = 16 marks)
