Study Program : Accounting

Faculty : Economics

ANDALAS UNIVERSITY

STUDENT ASSIGNMENT PLAN

COURSE Management Accounting

CODE EKA 204 Sks 3 SEMESTER 4

LECTURER Drs. Riwayadi, MBA., Ak., CA., CSRS., CPMA

ASSIGNMENT PROJECT:

Creating Learning Video

TITLE OF ASSIGNMENT:

Group_01: Creating Video for Problem Solving of Standard Costing

LESSON’S EXPECTED LEARNING OUTCOMES

1. Students have well understanding about how to determine the standard quantity and
standard price or rate as well as are able to calculate the standard cost.
2. Students are able to calculate and analyse the variances of manufacturing costs, and
understand accounting for standard costing as well as create the presentation video.

DESCRIPTION OF ASSIGNMENT

Read carefully the given case of standard costing and solve the case. Create the presentation
video.

STEPS TO SOLVE THE CASE

1. Read the case carefully

2. Understand the case
3. Discuss the solution of the case with group member
4. Solve the case
5. Make scenario and determine the role of each group member
6. Choose an interesting and appropriate spot for creating video
7. Create the video at most 20 minute duration
8. Present the video on class meeting schedule
OUTPUT

a. Assignment Project: Creating video for problem solving of standard costing

b. Output:

Presentation Video of problem solving of standard costing at most 20 minute durations.

Presentation Video must be submitted before the presentation begins.

INDICATOR, CRITERIA AND WEIGHT OF ASSESSMENT

a. Understanding the concept (20%)

 Able to solve and explain the case solution based on the concept
 Able to answer the question from audiences based on the concept
b. Accuracy and systematic of the case solution (20%)
 Able to solve the case accurately
 Able to solve the case systematically
c. Communication skills (10%)
 Communication can be easily understood
 Communication is delivered effectively
d. Team work (20%)
 Each group member is actively participated in class discussion
 Each group member has a role of video creation
e. Innovative and creative video creation (30%)
 Nice and interesting video (clear sound, good spot, good arrangement, clear picture, and
original)

TIME SCHEDULE OF VIDEO PRESENTATION

Video presentation Next class meeting after the topic has already been discussed by the
lecturer

OVERALL

The weight of this assignment is 20% of 100% assessment of this course

REFERENCES

 Hansen, Don R. & Mowen, Maryanne M. (HM), Management Accounting, 8th Edition, South
Western Publishing Company, Ohio, 2007
 Riwayadi, Akuntansi Biaya, Pendekatan Tradisional dan Kontemporer, Edisi 2, Cetakan ke 2
Penerbit Salemba Empat Jakarta, 2017 (Rwd)
ASSIGNMENT FOR GROUP 1

STANDARD COSTING
CASE
Traditional Padang Food manufactures “Rendang (dried spicy beef curry)” in the 250 gram box
that is sold in domestic and abroad. Puti Indang Sari, Accounting Manager, proposes to Datuk
Penghulu, President Director, to make the changes from actual cost system to standard cost
system. The following is memo from Puti Indang Sari to Datuk Penghulu.

MEMO
No. 315/Ak/IV/200x

Date: 21 April 200x

From: Puti Indang Sari, Accounting Manager
To: Datuk Penghulu, President Director

Regarding: Development of standard cost system

Dear Mr. Datuk,

It’s time for us to change our product costing because the existing system cannot be used for manager performance
evaluation purpose and for evaluating the efficiency of our company’s operation. We just compute our product cost
at the end of accounting period in order to prepare the financial statement. As a result, we don’t know whether or not
our product cost is efficient because we don’t know how much cost per unit of our product is. Since there is no
department’s manager performance evaluation, they never think to find ways to make the efficiency. Consequently,
no cost culture is built in our company. It will have negative impact on our company’s long term.
To implement standard cost system, in the beginning of period, we need to set standard quantity and standard
price to produce a box of Rendang. Quantity standard of raw material and direct labour hours can be set based on
laboratory research, and time and motion study or benchmarking. Price standard of raw material can be set by
cooperation with supplier through annual contract.
When we implement standard cost systems, we don’t need anymore to maintenance the subsidiary ledger of
raw material inventory and finished goods inventory. It eliminate all the costs related to the activities of subsidiary
ledger, such as operator salaries, supplies, etc. Moreover, managers will also think to make cost efficiency in order
their performance will be good.
By implementing the standard cost system, performance report can be prepared at the end of accounting
period by comparing between standard cost and actual cost. Then, the variance can be analysed and investigated to
find the root cause. Related department’s manager should be responsible for the variances, especially for significant
unfavourable variances. For example, procurement manager should be responsible for price variance of raw
materials and production manager should be responsible for quantity variance of raw materials. Responsibility of
variances is also for labour cost variances and factory overhead variances.
I hope you will consider my proposal. Thanks you.

Sincerely yours,

Puti Indang Sari

Required:
1. What is standard cost?
2. Why does the company need to develop the standard cost systems?
3. Why does subsidiary ledger of raw material inventory and finished goods inventory not
necessary when the company implements the standard cost systems?
4. Why should procurement manager be responsible for price variance of raw materials?
5. Assuming that standard raw material cost to produce 1 box of Rendang is as follows:

No. Raw Materials Quantity Standard Price standard Standard Raw

per Box Per Kg Material Cost

1. Beef 0,8 kg Rp 100.000 Rp 80.000

2. Coconut milk 0,4 kg Rp 10.000 4.000

3. Spices 0,2 kg Rp 20.000 4.000

Total Rp 88.000

Company produces 5.000 boxes of Rendang for year with actual direct raw material cost as
follows:

No. Raw Materials Quantity Standard Price standard Standard Raw

per Box Per Kg Material Cost

1. Beef 4.500 kg Rp 120.000 Rp 540.000.000

2. Coconut milk 1.800 kg Rp 13.000 23.400.000

3. Spices 900 kg Rp 19.000 17.100.000

Total Rp 580.500.000

Required:
a. Calculate the direct raw material cost variance
b. Analyse the variance into price variance and quantity variance
c. Make journal entries using three alternatives for material price variance