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2 marksCost Elements, Classification and Cost Curves

CAPE Accounting Unit 2 · 2018 · Paper 2 · Question 1(a)(i)

Zamore Ltd manufactures an electronic device through three departments: Forming (45 mins/unit, Grade A, 15.50/hr), Assembling (30 mins/unit, Grade B, 17.20/hr), and Finishing (20 mins/unit, Grade C, $20.30/hr). Production target is 1680 units for the week; standard work week is 35 hours per employee. Forming and Assembling receive a premium bonus of 1/4 of time saved. Finishing receives 1 1/2 hourly rate for overtime. Scott worked 38 hours producing 56 units in Forming. Celia worked 40 hours producing 114 units in Finishing.

Calculate the number of employees required in the Assembling Department to meet the production target of 1680 units.

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Other parts of this question

  1. 1(a)(ii)Calculate the weekly pay for Scott and Celia for that week.[8 marks]
  2. 1(b)(i)Prepare a cost comparison for the manufacture and purchase of the subassembly component.[8 marks]
  3. 1(b)(ii)State the decision that Zamore Ltd should make regarding the subassembly component, based on the cost comparison in (b)(i).[1 mark]
  4. 1(c)(i)Define the term 'EOQ inventory model'.[1 mark]
  5. 1(c)(ii)State TWO assumptions of the EOQ model.[2 marks]
  6. 1(c)(iii)Determine the number of production runs for Zamore Ltd, using the EOQ inventory model. (Note: Replace ordering cost by set-up costs).[6 marks]
  7. 1(c)(iv)Assuming Zamore Ltd is currently incurring total annual set-up and carrying costs of…[3 marks]
  8. 1(d)(i)Outline ONE importance of chemical waste disposal.[2 marks]
  9. 1(d)(ii)State TWO guidelines which must be followed when disposing of solid chemical waste.[2 marks]

More practice: the rest of this paper · more Cost Elements, Classification and Cost Curves questions · all CAPE Accounting Unit 2 past papers