Assessment 2 BACC2005 Due date and time2 June 2021 Wednesday 5 pmWeighting30%Assessment DescriptionThis assessment will be practical based case in a manufacturingsetting. Students will apply management and cost accounting skillsto solve this group assignment Learning Outcomes Graduate attributes1. Discuss the role of managementaccounting and ethical values indifferent times of organisationsCommunication: The ability tocommunicate effectively, both orallyand in writing, with a diverse rangeof audiencesCritical thinking and problemsolving: The ability to address andsolve problems creatively and in astructured and methodical wayFlexibility: The ability to criticallyassess and evaluate differentapproaches to issues and problems2. Describe and evaluate variouscosting systems (e.g. product,process, service and overheads).Critical thinking and problemsolving: The ability to address andsolve problems creatively and in astructured and methodical wayFlexibility: The ability to criticallyassess and evaluate differentapproaches to issues and problems3. Apply the knowledge of productcosting to real-world managementaccounting contexts.Research: The ability to conductthorough, accurate and targetedresearchCritical thinking and problemsolving: The ability to address andsolve problems creatively and in astructured and methodical wayFlexibility: The ability to criticallyassess and evaluate differentapproaches to issues and problemsUnit Name/CodeAssessment Type AssignmentAssessment Number 2Assessment Name Group AssignmentUnit Learning OutcomesAssessedDue Date and Time 7 April 2021 Wednesday 5:00 pmWeighting 30%Assessment Description This assessment will be short problem based questions and scenarios.Students will apply Management and Cost accounting skills to solve thisgroup assessment.Assessment 2 BACC2005Context:This is a group assignment. There can be only 4 students (maximum) in a group. Write a1500 word report. In the report appendix include tasks and duties completed by each groupmember and a brief note on how the group work experience was. Only one member needs tosubmit and upload the assignment in Moodle.Case Details:Stylish Ltd sells two models of coffee tables: Casual and Deluxe. Direct materialsinventory and finished goods inventory are costed using the first-in first-out (FIFO)method. Unit costs of direct materials purchased, and unit costs of finished goodssold remain unchanged throughout the budget year. There are two types of directmaterials namely XX and YY; XX is the material used as the legs of the table and YYis the materials used as the surface top of the table. The height of the table is onemeter. Direct manufacturing labour workers are hired on an hourly basis and noovertime is normally allowed for. Frank Morton, one of the workers, however,frequently exceeds 40 hours per week that involved overtime payments. Themanufacturing manager is generally happy with Frank’s works, but the manager talksto Frank constantly about working more quickly. Frank’s overtime causes the actualdirect labour costs to exceed the direct labour cost budget almost every month(reporting period).Direct manufacturing labour-hours is the cost driver for the variable portion ofmanufacturing operations overhead. The fixed component of manufacturingoperations overhead is tied to the manufacturing capacity of 300,000 directmanufacturing labour-hours that Stylish has planned for 2021.Setup labour-hours is the cost driver for the variable portion of machine setupoverhead. The fixed component of machine setup overhead is tied to the setupcapacity of 15,000 setup labour-hours that Stylish has planned for 2021.There are two cost drivers for manufacturing overhead costs – direct manufacturinglabour-hours and setup labour-hours. Stylish allocates all (variable and fixed)manufacturing overhead costs using direct manufacturing labour hours and machinesetup overhead costs using setup labour-hours. The manufacturing direct labourhours overhead costs budget for the year ending 30 June 2021 is $9,000,000 andthe machine setup overhead costs budget is $3,000,000.Stylish Ltd applies activity-based budgeting whereby the number of ‘Casual’ tables tobe produced in batch is 50 while the number of ‘Deluxe’ tables to be produced inbatch is 40. The setup time per batch is 10 hours for ‘Casual’ table and 12 hours for‘Deluxe’ table.Assessment 2 BACC2005Non-manufacturing costs consist of product design, marketing, and distributioncosts. All product design costs are fixed costs for 2021. The variable component ofmarketing costs equals the 6.5% sales commission on revenues paid tosalesperson. The variable portion of distribution costs is $2 per cubic meter of tablesmoved.The following data are available for the 2021 budget: Direct material XX$7 per meter (same as 2020)Direct material YY$10 per square meter (same as 2020)Direct labour$20 per hourProduct design costs$1,200,000 (same as 2020)Fixed marketing costs$1,300,000 (same as 2020)Fixed distribution costs$1,250,000 (same as 2020) Content of each product (table): Casual TableDeluxe TableDirect material XX12 meter12 meterDirect material YY6 square meter8 square meterDirect labour4 hours6 hours Changes in inventory level in finished goods inventory: Casual TableDeluxe TableExpected sales in units50,00010,000Selling price$600$800Target ending inventory in units11,000500Beginning inventory in units1,000500Beginning inventory in dollars$384,000$262,000 Changes in inventory level in direct material inventory: XXYYBeginning inventory70,000 meter60,000 sq. m.Target ending inventory80,000 meter20,000 sq. m. Assessment 2 BACC2005Stylish Ltd bases its budgeted cost information on the costs it predicts it will incur tosupport its revenue budget, taking into account the efficiency improvements itexpects to make in 2021. Some suggested budgets that might be useful to preparein table format are provided in the later pages of this assignment.Requirements:1. Discuss the results of sensitivity analysis of the changes in the selling prices(Casual and Deluxe type) and costs of raw materials (XX and YY) have on theoperating income of Stylish Ltd. The workings as well as the master budget(operating budget) needed for Stylish Ltd should be included at the back ofthe assignment as appendix and excluded in the word count.2. Suggest what might be done to solve the problem or improve the situation ofFrank Morton.Assessment 2 BACC2005AppendixRevenues’ budgetFor the year ending 30 June 2021 Quantity (units)Selling PriceTotal revenuesCasualDeluxeTotal Production budget (in units)For the year ending 30 June 2021 CasualDeluxeBudgeted unit salesTarget ending finished goods inventoryTotal required unitsDeduct: beginning finished goods inventoryUnits of finished goods to be produced Direct materials usage budget (in units)For the year ending 30 June 2021 XXYYDirect materials required for Casual tablesDirect materials required for Deluxe tablesTotal quantity of direct materials to be used Direct materials usage budget (in dollars)For the year ending 30 June 2021 XXYYBeginning direct materials inventoryPurchased direct materials during the periodDirect materials to be used Assessment 2 BACC2005Direct material purchases budgetFor the year ending 30 June 2021 Physical Units BudgetTo be used in productionAdd: Target ending inventoryTotal RequirementsLess: Beginning inventoryPurchases to be made (in quantity)Purchases in dollars Direct labour cost budgetFor the year ending 30 June 2021 Output unitsproducedDirect labourhours per unitTotal hoursHourlywage rateTotalCasualDeluxeTotal Stylish Ltd applies activity-based budgeting whereby the following information is available: Casual tablesDeluxe tablesQuantity of tables to be producedNumber of tables to be produced per batchNumber of batchesSetup time per batchTotal setup hoursSetup-hours per table Unit Costs of Ending Finished Goods Inventory Cost perunit‘Casual’inputTotal‘Deluxe’inputTotalXXYYDirect labourManufacturingoverheadMachine setupoverheadTotal Assessment 2 BACC2005Ending Finished Goods Inventories budget QuantityCost per unitTotalCasualDeluxeTotal Cost of Goods Sold BudgetFor the year ending 30 June 2021 Beginning finished goods inventory, 1/7/20Direct materials usedDirect manufacturing labourManufacturing overheadCost of goods manufacturedCost of goods available for saleLess: Ending finished goods inventory, 30/6/21Cost of goods sold Nonmanufacturing costs budgetFor the year ending 30 June 2021 Business functionVariable costsFixed costsTotal costsProduct designMarketingDistributionTotal Budgeted income statementFor the year ending 30 June 2021 RevenuesCost of goods soldGross MarginOperating costsProduct design costsMarketing costsDistribution costsOperating income Assessment 2 BACC2005The marking rubric of this assignment should be as follows: ILOsCriteriaStandardsBelow ExpectationsMeets ExpectationsExceeds ExpectationsLevel 1 (e.g. NN)Level 2 (e.g. PA)Level 3 (e.g. CR)Level 4 (e.g. DI)Level 5 (e.g. HD)20%50%70%85%100%LO1EXECUTIVESUMMARY (3 finalmarks)The executive summarynot provided or it doesnot presented key issuescovered in the study.The executive summary doesnot provide an overview ofthe report; however, itdiscusses the results fromthe analysisThe executive summaryprovides some key resultsand a justification for thestudy.The executive summaryprovides an overview ofthe report including keyresults and a justificationfor the study.The executive summaryprovides an excellentoverview of the study,including purpose,method, key results anda justification for thestudy.LO1INTRODUCTION (3final marks)Poorly written withoutproper explanation of thepurpose and key issues inthe study.A wordy statement of thecase but the purpose andkey issues in the study areadequately described.A reasonable introductionof the case and thepurpose and key issues inthe study are adequatelydescribed.A well written,interesting introductionof the case with excellentsummary of the purpose,background and keyissues studies in the case.An excellent andinteresting introductionof the case withexcellent summary ofthe purpose,background and keyissues studies in thecase.LO2 &LO3BODY (12 finalmarks)Considerableinaccuracies inknowledge andunderstanding withregard to the costanalysisLittle evidence drawnupon to supportSome inaccuracies inknowledge andunderstanding with regardto the sensitivity analysis,budgeting and employeeproductivity issues.Limited evidence drawnupon to support argumentsReasonable knowledgeand understanding withregard to the sensitivityanalysis, budgeting andemployee productivityissues.While most key issuesidentified with regard toIn-depth, expertknowledge andunderstanding withregard to the sensitivityanalysis, budgeting andemployee productivityissues.In-depth, expertknowledge andcomprehensiveunderstanding withregard to the sensitivityanalysis, budgeting andemployee productivityissues. Assessment 2 BACC2005* This general marking guide is only indicative and the lecturer reserves the right to vary this guide when warranted by circumstances in particular submissions. arguments with regard tosensitivity analysis onmaster budget andemployee productivity inrelation toacademic/professionalliterature.with regard to sensitivityanalysis on master budgetand employee productivity inrelation toacademic/professionalliterature.sensitivity analysis onmaster budget andemployee productivityissues are mentionedwith reference toacademic/professionalliterature.Most key issuesidentified with regard tosensitivity analysis onmaster budget andemployee productivityissues are explained (andreferenced) inacademic/professionalliterature.All key issues identifiedwith regard to sensitivityanalysis on masterbudget and employeeproductivity areexplained (andreferenced) inacademic/professionalliterature.LO2 & L03CONCLUSION (8 finalmarks)Poor, if anyconclusions/recommendation are provided forthe issues on masterbudget and employeeproductivity for the case.Limitedconclusions/recommendation are provided for themaster budget andemployee productivityissues.Reasonableconclusions/recommendation has been providedfor the issues regardingmaster budget andemployee productivity.Comprehensiveconclusions/recommendation has been providedfor the issuessurrounding masterbudget and employeeproductivity.A clear comprehensiveconclusions/recommendation has been providedfor the issuessurrounding masterbudget and employeeproductivity.N/AREFERENCES (2 finalmarks)Inappropriatereferencing.Very limited range ofresources usedHarvard style referencingused with some errors;Limited range of referencesusedCorrect Harvard stylereferencing used in textand reference list;Reasonable range ofresources used.Correct Harvard stylereferencing used in textand reference list;A wide variety of sourcesused.Correct Harvard stylereferencing used in textand reference list;A wide variety of highquality sources used.N/AWRITING (2 finalmarks)Inappropriatereferencing.Very limited range ofresources used.Harvard style referencingused with some errors;Limited range of referencesusedCorrect Harvard stylereferencing used in textand reference list;Reasonable range ofresources used.Correct Harvard stylereferencing used in textand reference list;A wide variety of sourcesused.Correct Harvard stylereferencing used in textand reference list;A wide variety of highquality sources used.
