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ACF1200 - Accounting for Managers Assignment

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Monash University

   

Accounting for Managers (ACF1200)

   

Added on  2020-03-07

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ACF1200 - In this Assignment, we will discuss the  Accounting for Managers The accountant has proposed an advertisement campaign to prevent the fall of the sales, due to an increase in price. Therefore, the success of the proposal is fully dependent on the success of the advertisement campaign. If the campaign fails to maintain the current sales level, then the sales revenue, as well as, the total profit, will fall and the proposal will not be able to fulfill the objective.

ACF1200 - Accounting for Managers Assignment

   

Monash University

   

Accounting for Managers (ACF1200)

   Added on 2020-03-07

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Running head: ACCOUNTING FOR MANAGERSAccounting for ManagersName of the Student:Name of the University:Author’s Note:
ACF1200 - Accounting for Managers Assignment_1
1ACCOUNTING FOR MANAGERSTable of ContentsAnswer to Question No.1:...............................................................................................................2Proposal of Accountant:-.............................................................................................................3Proposal of Production Manager:................................................................................................4Proposal of Sales Manager:-........................................................................................................5Answer to Question No.2:-..............................................................................................................6a)Capacity of 200000 units:-....................................................................................................7b)Capacity of 180000 units:-................................................................................................8Answer to Question 3:-....................................................................................................................9Answer to Question No.4:-............................................................................................................10a)Calculation of Overhead Allocation Rate:-........................................................................10b)Calculation of Total Cost for Special Order:-.................................................................10c)Calculation of Total Cost for Special Order under Machine Hour Rate:-..........................10d)Calculation of Minimum Price:-.....................................................................................11e)Advantages of Segmented Overhead Cost Pool & ABC Costing:-....................................11Bibliography:-................................................................................................................................13
ACF1200 - Accounting for Managers Assignment_2
2ACCOUNTING FOR MANAGERSAnswer to Question No.1:The directors of the company have received three different proposals from their threesenior staffs. To analyze the effect of the three proposals, it is important to determine the currentand profit structure of the company . The cost & profit of the company, based on the informationof last twelve months, are shown below:Statement of Cost & Profit:-Current StructureParticularsUnitCost p.u.AmountSales 200001302600000VariableManufacturing Cost2000050-1000000Fixed MaufacturingCost-400000Variable Selling & Administrative Costs2000030-600000Fixed Selling & Administrative Costs-300000Profit 2000015300000From the above statement, it can be stated that if the company continues with the currentcost & profit structure, then it can earn profit of $3,00,000 in total and $15 per unit. In suchconsequences, it will generate sale revenue of $26,00,000 annually.
ACF1200 - Accounting for Managers Assignment_3
3ACCOUNTING FOR MANAGERSProposal of Accountant:-Now, if the company considers the proposal of the accountant, the propose cost & profitstructure will be as follows:Statement of Cost & Profit:-1st AlternativeParticularsUnitCost p.u.AmountSales 200001402800000VariableManufacturing Cost2000050-1000000Fixed MaufacturingCost-400000Variable Selling & Administrative Costs2000030-600000Fixed Selling & Administrative Costs-425000Profit 2000018.75375000The table indicates that the company can be able to increase its annual profit to $375000from $300000 and the profit per unit will also increase to $18.75 from $15. The accountant hassuggested that the sales volume will not fall if an advertisement campaign will be continued atnational level. However, it has been observed that price and demand always inverselyproportional to each other. Whenever, price of any commodity falls, the demand of the same usesto increase accordingly and if the price increases, then the demand moves downward. Power drill
ACF1200 - Accounting for Managers Assignment_4

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