Management Accounting Assignment | Homework Help Websites
| Assessment Details and Submission Guidelines | ||||||||||
| Unit Title | Management Accounting | |||||||||
| Trimester | Trimester 3, 2018 | |||||||||
| Assessment Type | Report and Oral Presentation | |||||||||
| Assessment Title | Assessment Task 4 – Report [Group] | |||||||||
| Assessment Task 5 – Presentation [Group] | ||||||||||
| Unit Learning | The purpose of this assignment is to assess the following Learning Outcomes: | |||||||||
| Outcomes covered in | c. Produce business reports which present analyses of financial solutions to management
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| this assessment | issues | |||||||||
| d. Apply knowledge to generate adaptable and flexible approaches to problem solving and | ||||||||||
| decision making. | ||||||||||
| e. Apply management accounting practices and theories to analyse and solve business and | ||||||||||
| management problems. | ||||||||||
| Weight | Report [Group] 20% | |||||||||
| Presentation [Group] 10% | ||||||||||
| Total Marks | Report [Group] – 75 marks | |||||||||
| Presentation [Group] – 25 marks | ||||||||||
| Word limit | 1500 – 1750 words [Report] | |||||||||
| 5 – 8 PowerPoint slides [15 Minutes Presentation] | ||||||||||
| Release Date | Week 3 | |||||||||
| Due Date | Report [Group] – Week 10 | |||||||||
| Presentation [Group] – Week 11 | ||||||||||
| Submission Guidelines | Group size: This assignment should be completed in groups of four. | |||||||||
| All work must be submitted on Moodle by the due date along with a completed Assignment | ||||||||||
| Cover Page. | ||||||||||
| The assignment must be in MS Word format, 1.5 spacing, 11-pt Calibri (Body) font and 2 cm | ||||||||||
| margins on all four sides of your page with appropriate section headings. | ||||||||||
| Reference sources must be cited in the text of the report, and listed appropriately at the end | ||||||||||
| in a reference list using APA or IEEE referencing style for School of Business and School of | ||||||||||
| Information Technology and Engineering respectively. | ||||||||||
| For presentations conducted in class, students are required to wear business attire. | ||||||||||
Page 2 of 5
Assignment Description
This assessment task is comprised of two parts.
In part 1 students review current literature relating to various product costing systems, and approaches to applying overhead costs to each product. Students write a report to the senior management meeting based on the case study ‘Valdosta Vinyl Company (VVC)’.
In part 2, students present on the outcomes of the business report.
Part 1 – Business Report
Based on the case study below ‘Valdosta Vinyl Company (VVC)’ write a report to the senior management meeting addressing:
- issues relating to the system for applying overhead that is currently used by VVC,
- ways to improve VVC’s method for applying overhead by describing how it should revise its
product costing system
Report should include recommendations to improve VVC’s method for applying overhead by describing how VVC should revise its product costing system for each of the following departments:
- In the Cutting and Finishing Departments
- To accommodate automation in the Moulding Department
Report should incorporate the following sections:
- Cover page
- Executive summary
- Table of contents
- Introduction
- Literature review: this section should include topics such as
- Various product costing systems
- Traditional approaches to overhead cost allocation
- Limitations/shortcomings of traditional approaches to overhead cost allocation
- Contemporary approach to overhead cost allocation (Activity Based Costing)
- Limitations/impediments of introducing Contemporary approach to overhead cost allocation
- Conclusion and recommendations
- Reference list (8-10 references must be cited)
To achieve this task, you are required to:
- review literature from a range of sources, including books, and peer reviewed articles (cite at least 8-10 sources including 6-8 peer reviewed articles)
- investigate and analyse articles written on various product costing systems
- investigate and analyse articles written on traditional approaches to overhead cost allocation
- investigate and analyse articles written on contemporary approach to overhead cost allocation (Activity Based Costing)
Note: Group members must complete a progress report in week 10 and email it to the unit lecturer. Report must explain contribution of each group member to the assignment. See attachment.
Page 3 of 5
Case Study
Valdosta Vinyl Company (VVC)
John Patrick has recently been hired as controller of Valdosta Vinyl Company (VVC), a manufacturer of vinyl siding, used in residential construction. VVC has been in the vinyl siding business for many years and is currently investigating ways to modernise its manufacturing process. At the first staff meeting Patrick attended, Jack Kielshesky, chief engineer, presented a proposal for automating the Moulding Department. Kielshesky recommended that the company purchase two robots that would have the capability of replacing the eight direct labour employees in the department. The cost savings outlined in the proposal include the elimination of direct labour costs in the Moulding Department plus a reduction of manufacturing overhead cost in the department to zero because VVC charges manufacturing overhead on the basis of direct labour dollars using a plantwide rate. The president of VVC was puzzled by Kielshesky’s explanation: ‘This just doesn’t make any sense. How can a department’s overhead rate drop to zero by adding expensive, high tech manufacturing equipment? If anything, it seems like the rate ought to go up.’
Kielshesky responded by saying ‘I’m an engineer, not an accountant. But if we’re charging overhead on the basis of direct labour, and we eliminate the labour, then we eliminate the overhead.’
Patrick agreed with the president. He explained that as firms become more automated, they should rethink their product costing systems. The president then asked Patrick to look into the matter and prepare a report for the next staff meeting. Patrick gathered the following data on the manufacturing overhead rates experienced by VVC over the years. Patrick also wanted to have some departmental data to present at the meeting, and by using VVC’s accounting records, he was able to estimate the following annual averages for each manufacturing department over the five decades since VVC’s formation.
Historical data (using plant-wide overhead allocation rate)
| Average annual | Average manufacturing | |||
| manufacturing | Average annual | overhead application | ||
| Decade | overhead cost | direct labour cost | rate | |
| 1st | $2 200 000 | $2 000 000 | 110% | |
| 2nd | $6 240 000 | $2 400 000 | 260% | |
| 3rd | $13 600 000 | $4 000 000 | 340% | |
| 4th | $24 600 000 | $6 000 000 | 410% | |
| 5th | $38 710 000 | $7 900 000 | 490% | |
| Annual average costs during recent years | ||||
| Finishing | ||||
| Cutting department | department | Moulding department | ||
| Manufacturing | $22 000 000 | $14 000 000 | $4 000 000 | |
| overhead | ||||
| Direct labour | $4 000 000 | $3 500 000 | $500 000 | |
| Page 4 of 5 | ||||
| Part 1 marking criteria: | ||||
| Detailed Description of the Criteria | Marks | |||
| Criterion 1 | Structure and Clarity of the Report/Assignment | |||
| Ø executive summary | 2 | |||
| Ø introductory paragraph | 3 | |||
| Ø logical flow of clarity and structure of ideas and | 1 | |||
| arguments | ||||
| Ø appropriate use of paragraph and headings to | 1 | |||
| explain and discuss ideas | ||||
| Ø appropriate concluding paragraph and | 3 | |||
| recommendations | ||||
| Total marks for criterion 1 | 10 | |||
| Criterion 2 | Body/contents | |||
| Ø discuss various product costing systems | 5 | |||
| Ø discuss traditional approaches to overhead cost | 5 | |||
| allocation | ||||
| Ø discuss limitations/shortcomings of traditional | 10 | |||
| approaches to overhead cost allocation | ||||
| Ø discuss contemporary approach to overhead cost | 10 | |||
| allocation (Activity Based Costing) | ||||
| Ø discuss limitations/impediments of introducing | 10 | |||
| Contemporary approach to overhead cost | ||||
| allocation | ||||
| Total marks for criterion 2 | 40 | |||
| Criterion 3 | Investigation and Analysis (12 references must be cited) | |||
| Ø quality of information sources | 2 | |||
| Ø completeness of investigation and analysis | 2 | |||
| Ø accuracy and depth of analysis | 2 | |||
| Ø appropriate use of in-text and end text | 2 | |||
| referencing | ||||
| Ø appropriate number of references used | 2 | |||
| Total marks for criterion 3 | 10 | |||
| Criterion 4 | Contribution in group work | |||
| Ø Group members must complete a progress | 10 | |||
| report in week 10 and email it to the unit | ||||
| lecturer. Report must explain contribution of | ||||
| each group member to the assignment. | ||||
| Total marks for criterion 4 | 10 | |||
| Criterion 5 | Presentation | |||
| Ø layout | 1 | |||
| Ø formatting | 2 | |||
| Ø spelling/grammar | 2 | |||
| Total marks for criterion 5 | 5 | |||
| Total |  |
75 | ||
Note: Contribution in group work
Report any issues relating to group members immediately to your lecturer via email (e.g. unable to contact group member/s, not cooperating/contributing to group assignment etc.).
