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Ma Ba3201 Final


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Managerial Accounting


|Puganeswary Thirumalai Naidu |307254805 |BABHM |
|Tan Lian Ping |11001200428010 |BABHM |
|Yasmin Lim Binti Mohd.Arifin |307147803 |BBA MKT |
|Herry Abubakar Mshihiri |609687502 |BBA IB |


| |Task 1 : Sales and Labour Budgets : University |
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|1(b) | | |
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C) six action that NBU might take to accommodate growing of student number

➢ Hire part time staff

Help to keep the NBU organization cost down because basically part time staff paid based working hours. Can bring highly capable and experienced staff members even while the organization has a fixed budget and can't afford to bring someone in on a full-time basis

➢ Give rewards for full time staff

Rewards can divide in to two that are Intrinsic and extrinsic reward. Reward can be an motivation toll for staff work more. Extrinsic reward is bonus, pay rise, paid medical leaves, annual recreational plans and more. Extrinsic related more to money rewards. Intrinsic reward is ‘giving challenging task, involving in decision making process, giving a higher rank in hierarchy and extra, all these rewards do not required to have increased wage as well and member of staff may be working at higher management rank without an increase in the wage and still more motivated’. (Schermerhorn et al., 2008).

➢ One staff can take more classes

All the permanent staff can take more than one classes. Example after finish one class they continuing teach another classes that they willing to teach according staffs education and knowledge on the subject.

➢ Work overtime

Apart from working hour, staff can do overtime around 5-7pm. NBU have to pay the staff according to their overtime hours. These help organization to avoid find part time staff and they only going to pay for full time staff. When have part time staff, organization need to pay for part time and full time staffs at the same time its increase organization staff wages. Avoid wasting money to produce job vacancy advertisement in newspapers or other sources.

➢ Hire new staff

Based on staff qualification, educations, experience and knowledge on the subject and teaching skills NBU can hire a new staff. They need to have interview before hiring them, organization need to do some research to identify what type of salary that expect by the fresh and experienced candidates. Although its help to the organization to planning new staff salary estimations.

➢ NBU might also try outsourcing

NBU might also try outsourcing meaning they might get other organization to help them get the number of academic stuff needed (Wise Geek, 2012). Example NBU ask other university or collage to help them provide staff according hour basis salery

Question 2

a) Identify major activity performed by the staff in the department teachers the accounting course.

➢ Lecturing

A lecture is an oral presentation intended to present information or teach student about a specific subject, for example in NBU organization Management Accounting lecturer need to present their subject critical information, history, background, theories and equations to student.

➢ Tutorial classes

Apart from lecturing every week all the lecturer need to conduct tutorial class. For example one lecturing must have one tutorial. When the student number is big sometimes lecture need to conduct more than one class for a lecture.

➢ Marking and preparing assignment questions

Every semester all Management Accounting lecturer need to give assignment its can be a group or individual assignment. All the assignment paper needs to mark by the lecturer according to their marking skills. It’s counted according to the assignment paper and number of student summation.

➢ Setting and marking exam paper

All the Management accounting lecturer has a responsibility preparing exam question and have to mark it. After the final exams lecture also responsible to prepare reseat exam paper.

➢ Counseling student

Counseling student is guiding them whenever they have problems to do assignments or tutorial questions. At the same time they also need to clear student doubt on Management Accounting subject. Sometimes lecture need to counseling student whom share their personal problems sometimes.

b) Suggest possible activity drivers for each activity

|Cost Pool |Cost Driver |
|Lecturing |Number of classes |
|Marking and assessing Assignment |Number of Assignment |
|Setting and marking Exam Paper |Number of students |
|Counseling students |Number of hours |
|Tutorial |Depends of hours and classes |

c) Prepare the bill

| |Nilai Business University | | |
| |Nilai Education Sdn Bhd | | |
| |No,12-19 , Jalan Terminal 1, Pekan Nilai | | |
| |71800 Nilai , Negeri Sembilan | | |
|7/13/2012 |Tel:06-7994786 | | |
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|Item |Number of hours |Number of class |Total Salary |
|Lecturing hours |(4hr*RM100)=RM400 |2 |RM800 |
| |Number of assignment |Number of hours |Total Price of assignment |
|Marking and assessing Assignment |16*RM20=RM320 |4hrs |RM1280 |
| |Number of exam paper |Number of student |Total pirce of exam paper |
|Setting and marking Exam Paper |80* RM15=RM1200 |80 |RM96000 |
| |Per hours |Number of student |Total price for counseling |
|Counseling students |(4hrs*RM25)=RM100 |5 |RM500 |
| |Per hours |Number of classes |Total salary for tutorial |
|Tutorial |(4hrs*RM50)=RM200 |2 |RM400 |
| | |Total Salary |RM98980 |

Explanation for the bill

• Lecturing hours :

- 4hrs per week

- 1hours RM100.00

-number of class is 2

-Total Salary: (4hr* RM100.00)=RM400.00*2 class=RM800.00

• Marking and assessing assignment:

-Number of student:

Total student is 80.

For one group , there must be five members.

80 student / 5 members= 16 assignment paper

One paper is RM20.00

-Number of hours=4hours per day

-Total price of assignment is (16* RM20.00)=RM320* 4hrs=RM1280

• Setting and Making exam paper

-Total number of student is 80.

- One paper price is RM20.00

-80 set of papers.

-Total price of exam paper is (80 student*RM20.00)=RM1600*80 student=RM128000

• Counseling student

- counseling hour is 4 per week.

-80 student in class.

-one hours is RM25.00.

-Our estimate student for counseling is 5 person per day.

-Total price for the counseling is (4hr* RM25.00)=RM100.00* 5 student=RM500.00

• Tutorial

-Tutorial class per week is 4hour.

-One hours is RM50.00.

-80 students

-Per week we have two tutorial class, each class must be 40 student.

-Total salary for the tutorial is (4hr*RM50.00)=RM200.00*2 classes=RM400.00

d.) how would you account material?

The method we are choosing is Activity-Based Costing because the format of the Activity-Based Costing is much clear compare to Traditional Absorption Costing. Activity –Based Costing is designed from costs to activities. Activity-Based Costing is due to cause costs. It also affect the connectivity between the cost pool and cost driver.

e) Discourse the reasons why ABC may be preferred in traditional absorption method costing.

Activity based costing is important for today’s competitive and repeatedly changing business environment. Business environment’s impacts of changes make the company or industry to plan suitable strategy to continue exist and show a profit for examples implementation of higher manufacturing technologies computerized manufacturing have resulted in significant changes in the manufacturing cost formation which have led academic and practitioners to dispute that traditional costing methods are no longer sufficient within the new environment changes. (Johnson and Kaplan, 1987).

Important of ABC in the process of costing with regards to the product line, the end-users of the product, the stock-keeping units working by the organization and the channel and grouping which streamline the flow of the product from producer to the end user. Major benefit of ABC is that activity based cost pools can be better assigned to cost objects through the use of activity cost drivers that more accurately signify how these resources are used by the cost object stated Horngren (2003). Moreover system aids in the process of benchmarking which is an integral part of the quality control system. Another important factor in ABC is help to identify link between product and activity example by verify the service of organization which cause of the cost and secure the staff and their department activity but the activity not value said by Hixon(1995).

Apart from this some other disadvantage of ABC is very complex because need to follow many steps it’s also not easy to follow because it is new ,time consuming and very costly to handle.

The ABC concept was created as a technique which eliminates scarcity of the traditional method used in absorption costing. The purpose of using this method is to allocate overhead cost.

According to Popesko (2010), in recent years, absorption costing concepts has outdated appropriate to two main factors. First, intense competition in the market place, where it is a necessity to cut costs and the effect of having more detailed information on company costs. Second, changes in cost structure of a company. Based on the overhead of absorption rates can often provide incorrect information on product costs which meant majority of overhead costs, traditional allocation concepts.

In addition, the absorption costing method could fix its product costs because the overhead cost is allocated proportionally to the portion of direct costs. Glad and Becker (1996) has identified few fundamental limitations in traditional costing techniques which are, labor, using labor can assigning manufacturing overhead.

Cost of technology is not assign to products based on usage. For example, direct labor cost is replaced in indirect machine costs. Service related costs have increased considerably in last few decades this service related cost was previously non-existent. It is the customer-related costs (finance, discount, distribution, sales, service, etc) are not connected to the product’s cost objects.

The absorption costing method posses one important advantage where it is simple to put into utilization. Kim and Ballard (2002) have defined the problems that can result from using traditional absorption costing, such as: first, cost distortion hinders profitability analysis and secondly, there’s little management attention to activities.


Byrne, S., E. Stower, and P. Torry. (2008). Activity based costing implementation success in Australia. [cited 2008 26th August];
Available from:

Glad, E. and Becker, H. (1996) Activity based costing and management (ed). New York: John Wiley and Sons.

Horngren, C., Foster, G. and Datar, S., (2003) Cost Accounting: A Managerial Emphasis , 11 th edition, Prentice-Hall International Inc.; 2003.

Hixon. M (1995). Activity Based Management. It Purpose and Benefit. Management Accounting (CIMA). No73. Vol6. Pp 30-31.

Johnson, H.T. and R.S. Kaplan, Relevance Lost: The rise and fall of management accounting 1987: Harvard Business School Press cited in YI.F.Z and Ruhana.I.C. (2010) Factor Influencing Activity Based Costing Success: Research framework. ‘International Journal of Trade’ Economics and Finance, Vol. 1, No. 2.

Kim, Y. and Ballard, G. (2002) Case Study: Overhead cost analysis, proceedings IGLC, Gramado: Brazil.

Pilbara group, (2012). Activity based costing system. Retrieved online on 13th July from:,articleId-21225.html

Popesko, B. (2010) ‘Utilization of activity based costing system in manufacturing industries – Methodology, benefits and utilization’. International Review of Business Research Papers, Vol.6, No.1, pp. 1-17.

Schermerhorn, J. R. , Hunt, J. G., & Osborn, R. N. (2008). Organizational Behavior (10 ed.). NY : John Wiley & Sons Wise Geek, 2012. What is outsourcing? Retrieved on 29th June from:

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