Cost and Control Management Accounting: University Assignment Solution

This assignment solution provides a comprehensive analysis of management accounting principles, focusing on cost and control. The document includes detailed explanations and calculations for various accounting methods, such as process costing and job costing. It examines variance analysis, including material price and usage variances, and discusses the significance of budgeting in financial planning and forecasting. The assignment covers topics like the cost accounting cycle, contract costing, and budget preparation, providing tables and figures to illustrate key concepts. The solution also incorporates real-world examples, such as the Colosseum construction, to demonstrate the application of cost accounting techniques. The assignment is designed to aid students in understanding and applying management accounting concepts to make informed business decisions.

Running head: MANAGEMENT ACCOUNTING FOR COST AND CONTROL
Management Accounting for Cost and Control
Name of the Student:
Name of the University:
Author’s Note:
Number of Question Attempted: 5

MANAGEMENT ACCOUNTING FOR COST AND CONTROL
Table of Contents
Answer to Question 1......................................................................................................................2
Requirement A.............................................................................................................................2
Requirement B.............................................................................................................................6
Answer to Question 2......................................................................................................................7
Answer to Question 3....................................................................................................................11
Answer to Question 4....................................................................................................................15
Requirement A...........................................................................................................................15
Requirement B...........................................................................................................................18
Answer to Question 5....................................................................................................................19
Requirement A...........................................................................................................................19
Requirement B...........................................................................................................................22
Reference.......................................................................................................................................23
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Answer to Question 1
Requirement A
Normal View of Cost Accounts
Figure 1: (Table showing Direct Material Account)
Source: (Created by Author)
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Figure 2: (Table showing Work-in-Progress Account)
Source: (Created by Author)
Figure 3: (Table showing Finished Goods Account)
Source: (Created by Author)
Figure 4: (Table showing Account Payable Account)
Source: (Created by Author)
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Figure 5: (Table showing Cost of Goods Sold Account)
Source: (Created by Author)
Formula View of Cost Accounts
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Requirement B
The Colosseum is regarded as one of the most iconic building structures in Rome and is
also a major tourist attraction. The construction of such a magnificent structure was started at 72
AD and the same was completed in 80 AD. The Colosseum was used for hunting, battle of the
gladiators, execution or any other national event (Elkins, 2014). The colosseum was anticipated
to have space for 50,000 to 60,000 spectators at a time. At the time when the structure was being
constructed there was no costing system or an effective cost estimation process. It is anticipated
that the total cost of building the Colosseum must have taken a fortune. In today’s scenario the
cost can be billions of dollars and that too might be not enough. A restoration program which
was conducted on the Colosseum between 1993 and 2000 shows that an approximately 40 billion
Italian lire was expended. From this itself, a judgement can be developed as to how much
construction a similar monument might cost. As the construction of such a monument is slightly
similar to construction of buildings, therefore it is recommended that Contract costing must be
applied in order to recreate something similar to the monument (Larmour, 2016). The reason for
this is quite simple, the construction will be taking several years and large amount of funds
therefore the construction should be done on degree of completion which is applicable in
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Contract costing techniques. In addition to this, contract costing has provisions for increase in the
costs of certain materials over time and effective record and manage such changes.
Figure 5a: (Image Showing Colosseum)
Source: (Lepik, 2013)
Answer to Question 2
Normal View of Process Costing Accounts
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Figure 6: (Table showing Total Equivalent Units and Total Production)
Source: (Created by Author)
Figure 7: (Table showing Value of Closing WIP)
Source: (Created by Author)
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Figure 8: (Table showing Total Production Cost)
Source: (Created by Author)
Figure 8: (Table showing Work-in-Progress Account)
Source: (Created by Author)
Formula View of Process Costing Accounts
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Answer to Question 3
Normal View of Job Costing Accounts
Figure 9: (Table showing Joint cost allocated to B and selling price per kg)
Source: (Created by Author)
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