UNIVERSITI TEKNOLOGI MARA CAWANGAN PERAK

KAMPUS TAPAH

FACULTY OF ACCOUNTANCY

FUNDAMENTALS OF COST ACCOUNTING (MAF151)

GROUP:

AC1102C

LECTURER NAME:

SUNARTI HALID

PREPARED BY:

NO. NAME STUDENT ID

1. NURLIYANA ASYIKIN BINTI MD FUZI 2020820624

2. ANIS SHAHIRA BINTI USMAN 2020421694

3. NURUL AINA BINTI SHAMSUL 2020625832

4. NURINA NABILAH BINTI MAT SALLEH 2020883382

 TABLE OF CONTENTS

NO. CONTENT PAGE

Acknowledgement

1.0 Description of the product

1.1 Name of the product 1-2
1.2 Identify the cost elements to produce the product 3
1.3 Classify the cost elements into: 4–6
- The nature
- The behaviour of the costs
- The function of the cost
1.4 Pictures of the materials 7–8
1.5 The source documents/ evidence of the cost incurred to produce the 9 - 13
product

2.0 Cost Statement

2.1 Definition of cost statement 14
2.2 Objectives of cost statement 15
2.3 Cost statement of the product 16

Conclusion 17

References 18
 ACKNOWLEDGEMENT

First and foremost, praises and thanks to the almighty god, ALLAH SWT for showering us
with blessings throughout our MAF151 assignment, enabling us to complete it successfully.
We learned a lot during the assignment process, not only from an academic standpoint, but also
from the aspect of our personalities, as we worked together to complete the assignment. Our
deepest condolences to the Prophet Muhammad SAW, whose way of life has been a constant
source of inspiration for us.

Deep in our heart, we would like to express our heartfelt appreciation to our lecturer, madam
Sunarti Halid for giving us the golden opportunity to accomplish this MAF151 assignment.
With madam Sunarti guidance, dedications and supports, Finally, we will be able to finish the
project efficiently. She has given us positive encouragement and a warm spirit to help us
accomplish this project, and it has been a great pleasure and honour for us to have her as our
lecturer.

Last but not least, not to be missed, thank you also to everyone in this group, Nurina, Anis,
Liyana and Aina who is willing to squander their time, stimulating discussions and brilliant
ideas to provide the best possible results for the project. With the help of everyone in the group,
we were able to create one of the best projects for MAF151.
 1.0 DESCRIPTION OF THE PRODUCT

1.1 Name of The Product

1
We would like to introduce our product’s Dolce’ Totebag. The product we are producing is
originally called tote bag. It is essentially a bag that can be used to hold variety of stuff. Next,
the feature of the bag is very simple, and it can be design in a various way. It is also coming in
variety of styles, shapes, and sizes for people to choose based on their needs. Tote bags have
wide open top, which allow people to access everything inside easily. Therefore, majority of
the students prefer to have at least one at home. They can use the bag to go to school or college.
Students usually prefer this kind of bag because it is convenient to bring anywhere and can
carry a lot of items such as files, pencil case, calculator, smartphone, or even a small laptop.
Besides, tote bag also has two long straps for students to hang it on their shoulders.

We already decided to open this small business since our Semester 1 in UiTM. Finally, we
manage to open the business in Semester 2 while pursuing our Diploma. As the start of our
business, we manage to get 10 customers from our classmates. Hence, during this one month,
we cooperate and work hard together to produce 10 unit of Dolce’ Totebag. All of us are
charged fairly and equally, as we tried to create a successful business while gaining some
pocket money. Our product is basically based on the original kind of Cotton fabric. Therefore,
the product is high of quality and durable. We also created many types of design and style to
give our customers countless options to choose, as we combine all our ideas into something
new. Besides that, we also rented the best sewing machine that we can afford, so that we can
produce the best condition of tote bag to our customers. Unique in presentation of the product
and comes with aesthetic dimension of quality, Dolce’ Totebag known to be different from
other product.

2
1.2 Identify The Cost Elements To Produce The Product

1) Cotton fabrics
2) Cotton webbing belt
3) Thread snipper
4) Seam ripper
5) Pins
6) Measuring tape
7) Clear ruler
8) Sewing machine needles
9) Tailor’s salary
10) Rent- portable sewing machine
11) Utilities - Electricity bill

3
1.3 Classify Cost Elements To Produce The Product
1) The Nature:
Material Direct Material:

1) Cotton fabrics
2) Cotton webbing belt

Indirect material:

1) Thread snipper
2) Seam ripper
3) Pins
4) Measuring tape
5) Clear ruler
6) Sewing machine needles

Labour Direct labour:

1) Tailor’s wages

Expenses Direct expense:

1) Rent – portable sewing machine

4
 2) The behaviour of the cost:
Fixed cost -

Variable cost
1) Cotton fabrics
2) Cotton webbing belt
3) Thread snipper
4) Seam ripper
5) Pins
6) Flexible measuring tape
7) Clear 18 × 2 ruler
8) Sewing machine needles
9) Tailor’s wages
10) Rent – portable sewing machine

Mixed cost 1) Utilities – electricity bill

5
 2) The functions of the cost:

Production cost Direct material:

1) Cotton fabrics
2) Cotton webbing belt

Indirect material:
1) Thread snipper
2) Seam ripper
3) Pins
4) Measuring tape
5) Clear ruler
6) Sewing machine needles

Direct labour:
1) Tailor’s wages

Direct expenses:
1) Rent–portable sewing machine

Non-Production Overhead Administrative cost:

1) Utilities – electricity bill

6
1.4 Picture of Materials

Portable sewing machine Cotton Fabrics

Cotton Webbing Belt Pins

Thread Snipper

7
Seam Ripper Clear Ruler

Sewing Machine Measuring Tape

Needles

8
1.5 SOURCE DOCUMENT

ORIGINAL INVOICE NO INV : 001

Kedai Alatan Jahitan DATE : 2 MAY 2021
14-16,Jalan Bestarui, Taman Cherry,42100
Klang ,Selangor

TO:
Dolce’ Totebag
39 Jalan Jalan Batu Unjur,
42000, Pelabuhan Klang

Bil Description Quantity Price per unit Amount

(RM)
1 Clear Ruler 1 4.00 4.00

2 Thread Snipper 1 1.50 1.50

3 Seam Ripper 1 1.50 1.50

4 Pins 1 2.00 2.00

5 Measuring Tape 1 1.00 1.00

6 Standard Needle 1 2.00 2.00

AMOUNT 12.00

Term :-

DOCUMENT 1

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ORIGINAL INVOICE NO INV : 002
Nagoya Textiles & Fashion DATE : 5 MAY 2021
st
Lot 24,1 Floor,No 3 Bandar Bukit Tinggi, 42100
Klang ,Selangor

TO:
Dolce’ Totebag
39 Jalan Jalan Batu Unjur,
42000, Pelabuhan Klang

Bil Description Quantity Price Amount

(per per meter (RM)
meter) (RM)
1 Cotton Fabrics 10 4.00 40.00

2 Cotton Webbing Belt 7 2.00 14.00

AMOUNT 54.00

Term :-

DOCUMENT 2

10
 VOUCHER NO. 001
Dolce’ Totebag
39 Jalan Jalan Batu Unjur,
42000, Pelabuhan Klang

TO : Mira Date: 10 May 2021

DATE PARTICULAR AMOUNT

(RM)
28 May 2020 Taylor’s Wages (RM 3.00 x 10 units) 30.00

Ringgit Malaysian: Thirty Ringgit

Cash/Cheque No:-

Mira Ana
(Receiver) (Manager)

DOCUMENT 3

11
 VOUCHER NO. 002
Dolce’ Totebag
39 Jalan Jalan Batu Unjur,
42000, Pelabuhan Klang

TO: Encik Raju Date: 13 May 2021

DATE PARTICULAR AMOUNT (RM)

29 May 2020 Rent of Portable Sewing Machine 50.00

Ringgit Malaysian: Fifty Ringgit

Cash/Cheque No: -

Raju. Ana
(Receiver) (Manager)

DOCUMENT 4

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 Electricity Bill

Tempoh Bil : 1.05.2021 – 31.05.2021 (30 Hari) Faktor Prorata

Tariff. : B – Perdagangan 1.0000
Jenis Bacaan : Bacaan Sebenar

Blok Tarif (kWh) Kegunaan (kWh) Kadar (RM) Amaun (RM)

20 40.00 0.350 14.00
>20 60.00 0.300 18.00

Jumlah 100.00 32.00

Keterangan Tidak Kena ST Kena ST Jumlah

Kegunaan kWh 24.00 0.00 24.00
Kegunaa RM 32.00 0.00 32.00
ICPT (RM 0.2000) RM 9.12 0.00 9.80
15 % Diskaun Rangsangan. RM -4.80 0.00 -4.80
Ekonomi

Kegunaan Bulan Semasa RM 17.20 0.00 17.20

KWTBB (1.6%). RM 3.27
Caj Semasa RM 20.47

DOCUMENT 5

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 2.0 COST STATEMENT

2.1 Definition of Cost Statement

A cost statement can be defined as a breakdown of all costs incurred in every company
business. Direct costs which can be identified directly to the product will be added with
production overhead which cannot be identified directly to the product. Direct costs comprising
direct material cost (cost of raw materials used in a product), direct labour or wages cost (salary
payments to production workers) and direct expenses (expenses incurred specifically for a
particular product). The total of all direct cost we called as “PRIME COST”.

Production overhead also known as indirect costs or overheads comprising indirect material
cost (small consumption in a particular product), indirect wages (labour who cannot be traced
to specific product) and indirect expenses (expenses incurred in production which cannot be
allocated to cost units). By adding total of prime cost and indirect cost will make up
“PRODUCTION OVERHEAD”.

Last but not least, to get the TOTAL COST, we must sum up total of prime cost, production
overhead and non-production overhead. Non-production overhead can be divided by four
elements. There are Selling & Distribution cost, Research & Development Cost,
Administration Cost and Finance Cost.

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2.2 Objectives of Cost Statement

a) Determining Cost
The main goal of the cost sheet is to arrive at an exact product cost. It calculates the total cost
as well as the cost per unit of a product.

b) Fixing Selling Price

To determine the selling price of a product, company must first develop a cost statement that
shows the details of its manufacturing costs.

c) Cost Comparison
It allows management to compare a product’s current cost per unit to a former cost per unit
for the same product. If costs have escalated, comparing them allows management to take
corrective action.

d) Cost Control
A cost statement is an important document for a manufacturing company since it aids in cost
control. An estimated cost statement can help company to keep in track of labour, material,
and overhead expenses at each stage of the manufacturing process.

e) Decision Making
The cost statement is used to make some of the significant decisions made by management.
Managers use the cost statement whenever a company wants to manufacture or purchase a
component, or quote pricing for its goods in a tender.

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2.3 Cost Statement Of The Product

The following are the cost statement for the month of May 2021 by NALA Enterprise, the
owner and producer of Dolce’ Totebag:

NALA Enterprise
Cost statement for the month ended 31 May 2021

RM RM
Direct Material Cost:
Cotton fabrics (RM4 X 10 metres) 40
Cotton webbing belt (RM2 X 7 metres) 14 54.00

Direct Labour Cost:

Tailor’s wages (RM3.00 X 10 units) 30.00

Direct Expenses Cost:

Rent – Portable sewing machine 50.00

TOTAL PRIME COST 134.00

Add: Production Overhead Cost:

Indirect materials:
Thread snipper 1.50
Seam ripper 1.50
Pins 2.00
Measuring tape 1.00
Clear ruler 4.00
Sewing machine needles 2.00

TOTAL PRODUCTION COST 146.00

Add: Non-Production Overhead Cost:

Administration Cost:
Utilities – electricity bill 20.00

TOTAL COST 166.00

*Produced 10 units of Dolce’ Totebag in May 2021

Cost per unit = RM 166.00 / 10 units
= RM 16.60

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 CONCLUSION

Based on the facts we have gathered, we can infer that Dolce' Totebag is currently running a
terrific and seamless operation, as we have appropriately completed all of the entity's costing
and financials. This totebag project was a lot of fun for us. We began by creating totebag for
our classmates who had placed orders with us. We are grateful for the outpouring of love and
support. Finally, we successfully produced 10 units of totebag for our classmates in one month.
We can now smile without worrying about our starter business which is Dolce' totebag that has
become one of their favourite totebag. Furthermore, we just spent a small amount of capital,
less than RM20, to make high-quality totebag for our classmates. We hope that more students
will support our business, so that we can produce more units of totebag after this.

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 REFERENCES

Dontigney, E. (2017). what is the cost statement. Retrieved from https://bizfluent.com/info-

8362692-cost-statement.html

Jackson, B. (2021). what is a totebag used for? . Retrieved from

https://buffalojackson.com/blogs/insight/what-is-a-tote-bag-used-for

Krishnan, V. (2017). Cost Sheet - Meaning, Example & Format. Retrieved from
https://www.zoho.com/books/guides/cost-sheet.html

M, P. (2019). Cost Sheet. Retrieved from https://theinvestorsbook.com/cost-sheet.html

Mahanum, S. R. (2018). Cost Classification. In Fundamental of Cost Accounting (pp. 11-17).

Bootstrap Resources.

Mahanum, S. R. (2018). Cost Statement. In Fundamentals of Cost Accounting (pp. 21-23).

Bookstrap Resources.

Tasir, Z. '. (2018). In Super Skills Prinsip Perakaunan SPM (pp. 33-54). Sasbadi Sdn.Bhd

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