FEDERAL UNIVERSITY, OYE EKITI

FACULTY OF MANAGEMENT SCIENCES, DEPARTMENT OF ACCOUNTING

FIRST SEMESTER EXAMINATION 2021/2022 SESSION
Course Title: Management Accounting I Course Code: ACC 303 Units: 3 Time: 21/2hours
Instruction: Attempt question One (1) and any three (3) questions

QUESTION ONE (short answer(s) question-answer in a sequential order and provide only
the correct answer(s)
1. ________ _______ is concern with cost accumulation for stock valuation to meet the
requirement of external reporting whereas _____ ____ relates to the provisions of
appropriate information for people within the organization to help them better decisions.
2. ________is a language that communicate economic information to people who have an
interest in a organization manner shareholders and potential investors, employees
creditors and the government.
3. A detailed report to management comparing budgeted data against actual data for a
specific time period is called a___________
4. The manager in charge of the accounting department is generally known as the________
5. The accounting and other reports coming to management that are used in controlling the
organization are called_______
6. ________ is concerned with providing information for those who are inside the
organization whereas _______ is concerned with providing information for the use of
those who are outside the organization.
7. Management accounting place less emphasis on _____ and more emphasis on _____
______ than financial accounting.
8. The delegation of decision making authority throughout an organization by allowing
manager at various operating level to make key decision relating to their area of
responsibility is called________
9. A______ position provides service or assistance other parts of the organization and does
not directly achieve. The basic objectives of the organization.
10. ________ consists of identifying alternative selection from among the alternatives the
one that is best first the organization and specifying what action will be taken to
implement the chosen alternative.
11. _________________ is the study of organization that are among the best in the world at
performing a particular test.
12. The application of professional knowledge and skills in the presentation of Accounting
information so as to assist management in the formulation of policies, and in planning
and controlling of activities of business enterprise is called?
13. ______________ ________is concern with cost accumulation for stock valuation to meet
the requirement of external reporting whereas ____ _____ relates to the provisions of
appropriate information of people within the organization to help them better decisions.
14. ___________ is a language that communicate economic information to people who have
an interest in an organizational shareholders and potential investors, employees’ creditors
and the government.

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 15. A detailed report to management comparing budgeted data against actual data for a
specific time period is called a _____________
16. The manager in charge of the accounting department is generally known as the _______
17. The accounting and other reports coming to management that are used in controlling the
organization are called ____________
18. ________ is concerned with providing information for those who are inside the
organization whereas _____ is concerned with providing information for the use of those
are outside the organization
19. Management accounting places less emphasis on ______ and more emphasis on _______
than financial accounting
20. The delegation of decision making authority throughout an organization by allowing
manager at various operating level to make key decision relating to their area of
responsibility is called ________________ ( 25marks)

Question 2
Emmayemi Pharmaceutical store manufactures one product “AKD” and operates a standard
costing system analysis of variance monthly . the standard cost card for “AKD” is as follows
Direct material =0.5kg at N 4 .00 per kg
Direct wages = 2 hours at N 2.00 per hours
Variable overhead = 2hours at N 0.50 per hours
Actual result for the period were as follows
Product for the month = 4850 unit is of AKD
Material consumed in production was 2300kg at a total cost of N 9, 800
Labour hours paid for amounted to 8 500 hours at a cost of N 16, 800
Other details for the month are:
a. actual operating hours 8000hrs
b. variable overhead N 3000
You are required to calculate
(a) material variance (b) material usage variance (c) labour rate variance (d) labour variance
efficiency (15marks)
Question 3
The management of CHINNAIRE PLC has been evaluating whether the company should
continue manufacturing a component or buy it from an outside supplier. A N100 cost per
component was determined as follows:
N
Direct Material 15
Direct Labour 40
Variable Manufacturing 0/H 10
Fixed Manufacturing Overhead 35
100

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The company uses 4000 components per year. Eagle Limited submitted a bid of N50 per
component, some members of management felt they could reduce costs by buying from outside
and discontinue production of the component.

If the component is obtained from Eagle Limited, CHINNAIRE unused productions facilities
could be leased to another company for N50.000 per year.
Required:
CHINNAIRE PLC could pay to an outside supplier.

(b) Indicate if the company should make or buy the component and the total naira difference
in favour of that alternative.

(c) Assume the company could eliminate are production supervisor with a salary of N10,000
of the component is purchased from an outside supplier, indicate if the company should
make or buy the component and the total naira difference associated our decision.
(15Marks)

Question 4
In the broadest sense, all accounting is management accounting, all financial and cost
information generated by accountant is of some interest to management. But in practice, where
management accounting differs from financial accounting? From an insight into management
accounting by John Sizer
Required
a. A brief definition of management accounting (5 marks)
b. A discussion of the major difference between management and financial accounting
(5 marks)
c. To manage? Write a well-known authority to forecast and plan, to organize to
command, to coordinate and to control? (5 marks)
Question 5
Limited accounting year normally ends on 30 th September of every year. The company has
instructed its Chief Accountant to prepare the cash budget for the first four months of the year
beginning from October, 2019. The following data are given:

(i) Total Sales - August 2019 N150,000

- September 2019 N 200,000

- October 2019 N 180,000

- November 2019 N 250,000

- December 2019 N 300,000

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 - January 2020 N 400,000

40% of the total sales is for cash while the remaining are credit sales to be collected as follows:

(ii) Total Purchases - September 2019 N100,000

- October 2019 N 80,000

- November 2019 N 120,000

- December 2019 N 50,000

- January 2020 N 150,000

50% of the total purchase is for cash. 50% of credit purchases must be settled within one month
and the remaining within two months after purchase.

(iii) The company pays the following expenses during the budget period:

- Company Income Tax of N25,000 in October 2019

- Salaries and wages of N50,000 every month
- Dividends of N50,000 in February 2020
- Plant costing N150,000 in May 2020
(iv) The company will receive the following additional income:

-
Sales of motor vehicle costing N10,000 for N12,000 in November 2019.
-
Dividends received of N5,000 and N9,000 in October and December
2019respectively.
(V) The cash balance brought forward as at 1 st October 2019 was an overdraft of
N10,000.
Required: Prepared the cash budget of the company for each of the first four months of
2019and 2020 financial year. (15 Marks)

QUESTION 6
(a) Discuss the role of management accountancy in its services to management dealing
especially with its contribution to planning and controlling element referred in the
quotation (5 marks)
(b) Give any five merits and demerits of planning especially corporate plans (5 marks)
(c) List any five characteristics of good management you know (5 marks)