Managerial accounting

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In managerial accounting, costs can be classified by behavior, traceability decision-making, external reporting , prime costs vs conversion costs and Function Wise Classification. Discuss all the above cost classifications and explain the importance of each classification. (2.0 marks)

Answer:

Q2. Compare Job Order Costing versus Process costing (one marks)

Answer:

Q3. ABC Company had the following inventories on May 1, 2019(amounts in SR) (two marks)

Raw Material30,000

Finished Goods40,000

WIP – Material20,000

WIP – Labor20,000

WIP – Manufacturing overhead 15,000

During the month, the cost of material purchased was 130,000 direct labor cost incurred was 140,000 and factory overhead applicable to production was 70,000, on May 31, inventories were:

Raw Material40,000

Finished Goods50,000

WIP – Material15,000

WIP – Labor25,000

WIP Manufacturing overhead10,000

Required:

Prepare Journal entries on May 31, to show the flow of cost through the proper summary T accounts. Assume that sales values were 500,000 on credit

Answer:

Sample Solution

“A circumstance wherein the estimation of money related establishments or the estimation of their advantages drops quickly.” A budgetary emergency is regularly connected with a frenzy or a bank run that may fall entire monetary arrangement of economy. The speculators auction resources or pull back cash from bank accounts with the desire that the estimation of those benefits will drop on the off chance that they stay at a budgetary foundation. Budgetary emergency implies defeat in the estimation of the nation money and monetary organizations or market instrument accordingly nation may experience the ill effects of downturn.

‘Money related Crisis’:

A money related emergency can come because of establishments or resources being exaggerated, and can be declined by financial specialist conduct.

One case of a money emergency happened in Russia in 1998 and prompted the degrading of the ruble and the default on open and private obligation. Money emergencies, for example, of Russia’s may rise up out of assortment of monetary conditions, for example, enormous shortages and low outside stores. These emergencies may have impact on one’s nation on occasion when its neighboring nations are encountering monetary emergency.

THE RUSSIAN DEFAULT: A BRIEF HISTORY

Following six years of financial change in Russia, privatization and macroeconomic adjustment had encountered some restricted achievement. However in August 1998, in the wake of recording its first year of positive monetary development since the fall of the Soviet Union, Russia had to default on its sovereign obligation, depreciate the ruble, and proclaim a suspension of installments by business banks to remote leasers.

“What made the Russian economy face a monetary emergency after so much had been practiced In April 1996”? Russian authorities started dealings to reschedule the installment of outside obligation acquired from the previous Soviet Union. These arrangements were a significant advance toward reestablishing financial specialist certainty. Evidently 1997 appeared to be ready to be a defining moment toward monetary solidness.

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