UNIVERSITY OF SOUTH AFRICA
College of Accounting Sciences
⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄⋄
MAC3701: Application of Man-
agement Accounting Techniques
Compulsory Assessment 2 — Semester 1, 2026
⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄⋄
MAC3701
Module Code:
Application of Management Accounting
Module Name:
Techniques
Compulsory Assessment 2
Assessment:
April 2026
Due Date:
100
Total Marks:
Submitted in partial fulfilment of the requirements for MAC3701 — UNISA 2026
,UNISA | MAC3701 Assignment 2 — S1 2026
Part A: Processing Division (PD) Income Statement and Business Risks
(A-a) Actual Statement of Profit or Loss for December 2025
Step 1: Output Quantities
Table 1: Output Quantities from 220 000 Coconuts
Product Yield per Coconut Total Output
Virgin Coconut Oil (VCO) 0,35 L 77 000 L
Fresh Coconut Water (FCWa- 0,45 L 99 000 L
ter)
Coconut Husk (Husk) 500 g 110 000 kg
Step 2: Total Joint Production Costs
Raw Materials:
• 220 000 coconuts × R18 = R3 960 000
Variable Manufacturing Overheads (VMO):
• Batches = 220 000 ÷ 500 = 440 batches
• VMO = 440 × R440 = R193 600
Direct Labour:
• Clock hours = 220 000 × (12 ÷ 60) = 44 000 clock hours
• The standard clock rate is R90 per work hour with 10% allowed idle time.
• Work hours = 44 000 × (1 − 0,10) = 39 600 productive work hours
• Labour cost = 39 600 × R90 = R3 564 000
Critical Consideration
The clock rate of R90 is expressed per work hour (productive time). Clock hours
include 10% idle time. Therefore, productive work hours = total clock hours × 90%.
Workers are paid for all clock hours at a rate that, when applied to work hours only,
gives the correct wage cost.
Fixed Manufacturing Overheads (FMO):
Page 2 of 27
, UNISA | MAC3701 Assignment 2 — S1 2026
• Actual FMO = R150 000
Total Joint Costs = R3 960 000 + R193 600 + R3 564 000 + R150 000 = R7 867 600
Step 3: By-Product Treatment (Husk)
Under the net realisable value (NRV) method, the Husk NRV is deducted from total joint costs
before allocation to the joint products.
• Husk Revenue: 110 000 kg × R5,00 = R550 000
• Husk Packaging Cost: 110 000 kg × R1,20 = R132 000
• Husk NRV = R550 000 − R132 000 = R418 000
Joint costs after by-product deduction = R7 867 600 − R418 000 = R7 449 600
Step 4: Allocation of Joint Costs (Physical Measure Method at Split-off)
Physical quantities at split-off: VCO = 77 000 L; FCWater = 99 000 L. Total = 176 000 L.
Table 2: Joint Cost Allocation at Split-off
Product Litres Ratio Allocated Cost (R)
VCO 77 000 77/176 3 259 200,00
FCWater 99 000 99/176 4 190 400,00
Total 176 000 7 449 600,00
Workings:
• VCO: (77 000 ÷ 176 000) × R7 449 600 = R3 259 200
• FCWater: (99 000 ÷ 176 000) × R7 449 600 = R4 190 400
Step 5: Further Processing Cost for FCWater
FCWater is further purified and pasteurised at R12 000 per KL. 1 KL = 1 000 L.
• FCWater = 99 000 L ÷ 1 000 = 99 KL
• Further processing cost = 99 × R12 000 = R1 188 000
Page 3 of 27
College of Accounting Sciences
⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄⋄
MAC3701: Application of Man-
agement Accounting Techniques
Compulsory Assessment 2 — Semester 1, 2026
⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄ ⋄⋄
MAC3701
Module Code:
Application of Management Accounting
Module Name:
Techniques
Compulsory Assessment 2
Assessment:
April 2026
Due Date:
100
Total Marks:
Submitted in partial fulfilment of the requirements for MAC3701 — UNISA 2026
,UNISA | MAC3701 Assignment 2 — S1 2026
Part A: Processing Division (PD) Income Statement and Business Risks
(A-a) Actual Statement of Profit or Loss for December 2025
Step 1: Output Quantities
Table 1: Output Quantities from 220 000 Coconuts
Product Yield per Coconut Total Output
Virgin Coconut Oil (VCO) 0,35 L 77 000 L
Fresh Coconut Water (FCWa- 0,45 L 99 000 L
ter)
Coconut Husk (Husk) 500 g 110 000 kg
Step 2: Total Joint Production Costs
Raw Materials:
• 220 000 coconuts × R18 = R3 960 000
Variable Manufacturing Overheads (VMO):
• Batches = 220 000 ÷ 500 = 440 batches
• VMO = 440 × R440 = R193 600
Direct Labour:
• Clock hours = 220 000 × (12 ÷ 60) = 44 000 clock hours
• The standard clock rate is R90 per work hour with 10% allowed idle time.
• Work hours = 44 000 × (1 − 0,10) = 39 600 productive work hours
• Labour cost = 39 600 × R90 = R3 564 000
Critical Consideration
The clock rate of R90 is expressed per work hour (productive time). Clock hours
include 10% idle time. Therefore, productive work hours = total clock hours × 90%.
Workers are paid for all clock hours at a rate that, when applied to work hours only,
gives the correct wage cost.
Fixed Manufacturing Overheads (FMO):
Page 2 of 27
, UNISA | MAC3701 Assignment 2 — S1 2026
• Actual FMO = R150 000
Total Joint Costs = R3 960 000 + R193 600 + R3 564 000 + R150 000 = R7 867 600
Step 3: By-Product Treatment (Husk)
Under the net realisable value (NRV) method, the Husk NRV is deducted from total joint costs
before allocation to the joint products.
• Husk Revenue: 110 000 kg × R5,00 = R550 000
• Husk Packaging Cost: 110 000 kg × R1,20 = R132 000
• Husk NRV = R550 000 − R132 000 = R418 000
Joint costs after by-product deduction = R7 867 600 − R418 000 = R7 449 600
Step 4: Allocation of Joint Costs (Physical Measure Method at Split-off)
Physical quantities at split-off: VCO = 77 000 L; FCWater = 99 000 L. Total = 176 000 L.
Table 2: Joint Cost Allocation at Split-off
Product Litres Ratio Allocated Cost (R)
VCO 77 000 77/176 3 259 200,00
FCWater 99 000 99/176 4 190 400,00
Total 176 000 7 449 600,00
Workings:
• VCO: (77 000 ÷ 176 000) × R7 449 600 = R3 259 200
• FCWater: (99 000 ÷ 176 000) × R7 449 600 = R4 190 400
Step 5: Further Processing Cost for FCWater
FCWater is further purified and pasteurised at R12 000 per KL. 1 KL = 1 000 L.
• FCWater = 99 000 L ÷ 1 000 = 99 KL
• Further processing cost = 99 × R12 000 = R1 188 000
Page 3 of 27
