Fifth edition Alnoor Bhimani Charles T. Horngren Srikant M. Datar Madhav V. Rajan Farah Ahamed



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solutions-manual-to-bhimani-et-al-management-and-cost-accounting-pearson-2012-1
Instrument 101
Instrument 201
Direct materials Direct manufacturing labour Manufacturing overhead allocated
101: 1,000 × €180 per hour 500 × €180 per hour
1 Total
2 Units produced
3 Cost per unit 1 ÷ 2
€100,000 20,000 180,000

€300,000 5,000
€60
€300,000 10,000

90,000
€400,000 20,000
€20


Bhimani, Horngren, Datar and Rajan, Management and Cost Accounting, 5
th
Edition, Instructor’s Manual
© Pearson Education Limited 2012
Note: Direct manufacturing labour costs at Euro-Medi comprise only 4.3% of total production costs

101 + 201
%
Direct materials
€400,000 57.1% Direct manufacturing labour
30,000 4.3
%
Manufacturing overhead allocated
270,000 38.6
%

€700,000 100.0%
2
Total conversion cost pool
(€20,000 + €10,000 + €270,000)
=
€300,000 Total direct materials cost
(€100,000
+
€300,000)
=
€400,000 Conversion cost rate = €300,000 = 0.75 or 75% of direct materials cost
€400,000 Costs per instrument


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