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Answers Assignment3 Acct 301

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Accounting
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Saudi electronic university
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College of Administrative and Financial Sciences
Assignment 3
Deadline: 10/04/2021 @ 23:59 (End of week 12)
Course Name: Cost accounting
Student’s Name:
Course Code: ACCT 301
Student’s ID Number:
Semester: 1
CRN:
Academic Year: 1441/1442 H
For Instructor’s Use only
Instructor’s Name: Dr. Mohammed Arshad Khan
Students’ Grade: Marks Obtained / Out of
Level of Marks: High/Middle/Low
Instructions PLEASE
The Assignment must be submitted on Blackboard (WORD format only) via allocated
folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced for
poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No
pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.

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Q1 What are support departments, and why are their costs allocated to other departments?
What process is used to allocate support department costs?
(1.5 Marks, week 10 materials)
Q2 How are joint costs allocated? Explain and analyze using numerical example.
(1.5 Marks, week 11 materials)
.
Q 3 How are budget variances calculated and used as performance measures? Provide
numerical example?
(2 Marks, week 12 materials)
Answers:
Q1.)
Support departments provide services to the internal operating departments of the organization.
Some of the common examples for the supporting departments in a typical manufacturing
organization are information systems, human resources, marketing, research and development, and
general administration (Eldenburg & Wolcott, 2011). Costs related to support departments cannot
be allocated to one particular department as those costs are common costs. It is important to allocate
the costs of support departments to maintain external reports, monitor consumption of support
department costs, improve the coordination and efficiency of all the departments for controlling
purposes and, make decisions such as pricing, make or, buy.
Process of allocating support department costs
1) The purpose of the allocation should be clarified.
If the organization needs to encourage the use of services of a new support department, then costs
would not be allocated. To discourage the over-use of a support department cost, a specific rate can
be introduced. To figure out the full cost, all costs related to support costs should be considered.

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College of Administrative and Financial Sciences Assignment 3 Deadline: 10/04/2021 @ 23:59 (End of week 12) Course Name: Cost accounting Student’s Name: Course Code: ACCT 301 Student’s ID Number: Semester: 1 CRN: Academic Year: 1441/1442 H For Instructor’s Use only Instructor’s Name: Dr. Mohammed Arshad Khan Students’ Grade: Marks Obtained / Out of Level of Marks: High/Middle/Low Instructions – PLEASE • The Assignment must be submitted on Blackboard (WORD format only) via allocated folder. • Assignments submitted through email will not be accepted. • Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page. • Students must mention question number clearly in their answer. • Late submission will NOT be accepted. • Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions. • All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism). • Submissions without this cover page will NOT be accepted. Page 1 of 7 Q1 What are support departments, and why are their costs allocated to other departments? What process is used to allocate support department costs? (1.5 Marks, week 10 materials) Q2 How are joint costs allocat ...
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