GACT5113 Managerial Accounting Final Assessment Nov 2025 | UNIRAZAK

GACT5113 Final Assessment

DATE/DAY: 22^ND DECEMBER 2025 – 28^TH DECEMBER 2025 / MONDAY – SUNDAY

DURATION: 7 DAYS

Instructions for Candidates

1. Please answer ALL questions.
2. Type your answers in Times New Roman Font 12 with 1.5 Spacing
3. Submit the answer’s soft copy through the course’s UROX platform.
4. The similarity index should be less than 20%.
5. You are required to submit the final assessment on time. Any reason for the late submission will not be entertained.

Plagiarism / Originality of the Contribution

(Excerpt from Item 17.0, Unirazak Academic Regulations for Postgraduate Programmes)

1) Plagiarism refers to the unauthorized use or close imitation of the language and thoughts of another author without acknowledgment, and to represent it as one’s own original work in fulfilling an academic requirement, such as in assignments, dissertations, and thesis.

2) This also includes any usage of AI tools such as ChatGPT or any similar tools.

3) A Student who committed plagiarism will be penalized based upon a decision made by the Faculty Academic Committee.

4) Details of the prohibition against plagiarism can be referred to the Unirazak Student Regulations Book.

Examination Misconduct

(Excerpt from Item 21.4.2, Unirazak Academic Regulations for Postgraduate Programmes)

1) A student who has committed misconduct or academic wrongdoing can be charged with Academic misconduct according to the University and College University Act, 1971, Regulations of the University (Students Disciplinary).

a) Giving, receiving, or possessing notes or some other materials in various forms relevant to the course during the examination inside and outside of the exam hall

2) If the student is found guilty of misconduct by the Faculty Academic Committee and pending the approval of the Senate, the student can be penalized as follows:

a) Receive a ZERO (0) mark for the examination

OR

b) Receive a ZERO (0) mark for the course

OR

c) Receive a ZERO (0) mark for all registered courses for the semester

OR

d) Suspended from study for a duration specified by the Senate.

3) Students who are caught breaching the Examination Rules and Regulations will be charged with Academic Dishonesty. If found guilty of the offence, the maximum penalty is expulsion from the University.

GACT5113 Case Study Questions (100 MARKS)

INSTRUCTION(S): Attempt ALL questions.

Question 1: Activity-Based Costing (25 Marks)

Nova Appliances Sdn Bhd is a mid-sized Malaysian manufacturer of household kitchen appliances. It produces three main product lines: electric kettles, food processors, and induction cooktops. For many years, the company has used a traditional overhead allocation system based on direct labor hours. However, as production has become more automated and product lines more diverse, the finance department began to question the accuracy of this costing method.

After a detailed internal study, the management decided to implement Activity-Based Costing (ABC). The new system allocated overheads based on activities such as machine setups, product design changes, customer orders, and machine processing hours. The results were eye-opening: the electric kettles, previously considered the most profitable product, turned out to be undercosted. Meanwhile, food processors were significantly overcosted under the traditional method.

This change created friction across departments. The sales team had been pushing electric kettles with aggressive discounts based on the previously assumed high profit margins. Now, they were being asked to reconsider their strategy. Product development was also questioned for prioritizing the wrong items. Several department heads were resistant to adopting the ABC data, claiming it was too complex or that it contradicted years of “intuition.”

The CEO now faces a leadership challenge: how to integrate the new ABC data into strategic planning, pricing, and performance evaluation, and how to ensure that managers across all functions use this improved cost information effectively.

Required:

Discuss the strategic and organizational implications of implementing Activity-Based Costing at Nova Appliances. In your answer:

1. Explain how ABC provides more relevant information for decision-making in a complex manufacturing environment.

(5 marks)

2. Evaluate any TWO (2) behavioural and cross-functional challenges of introducing ABC, especially when it disrupts long-standing practices.

(10 marks)

3. Recommend any TWO (2) ideas on how the company can ensure successful integration of ABC insights into pricing, performance evaluation, and strategic planning.

(10 marks)

[Total: 25 marks]

Question 2: Budgeting (25 Marks)

EcoDrive Motors Sdn Bhd is a growing company based in Selangor that designs and manufactures electric scooters for urban commuters. With increased competition, changing government incentives, and fluctuating costs of lithium batteries and imported components, EcoDrive has faced mounting uncertainty in financial forecasting.

Until recently, the company used an annual static budget prepared every November. However, frequent variances between actual results and budgeted figures raised concerns about the budget’s relevance. In response, the CFO introduced a rolling budget system, where budgets are updated quarterly based on the latest sales forecasts, cost trends, and strategic changes.

While the rolling budget has increased adaptability, not all department heads are pleased. The R&D director finds it disruptive to long-term project planning. The production team feels overwhelmed by frequent adjustments to capacity targets. Some managers feel micromanaged and argue that too many changes create confusion and reduce accountability.

Meanwhile, the finance team believes the rolling budget has improved cost control and cash flow management, especially during a recent supply chain disruption that forced changes in production schedules. The CEO wants to evaluate whether the benefits outweigh the growing internal resistance and whether any adjustments should be made to balance flexibility and stability.

Required:

Critically evaluate the implementation of rolling budgets at EcoDrive Motors. In your answer, propose FIVE (5) recommendations to improve the budgeting process to ensure both flexibility and strategic alignment across the organization.

[Total: 25 marks]

Question 3: Standard Costing (25 Marks)

GreenBrew Beverages Bhd is a well-known FMCG company in Malaysia, specializing in the production of organic herbal teas and health drinks. It operates large-scale automated production lines with consistent processes. For over a decade, GreenBrew has used a standard costing system to manage and control production costs. Each product has carefully determined standards for material usage, labor hours, and overhead allocation.

Recently, however, GreenBrew has been facing unexpected cost variances. In particular, unfavorable material usage and labor efficiency variances have occurred in several months. The procurement manager explains that global supply disruptions have forced them to purchase lower-quality herbal ingredients, affecting usage rates. The operations manager points to high turnover and the hiring of inexperienced workers as causes of labor inefficiencies.

Despite these explanations, the finance team insists that such variances signal poor management and calls for stricter controls. The debate has escalated to the executive level, with some directors questioning whether standard costing is still a useful system given today’s operational volatility and external pressures. They are considering whether to revise the system or adopt alternative performance measurement tools.

Required:

Evaluate the relevance and limitations of using standard costing as a performance management tool at GreenBrew Beverages. In your answer:

1. Discuss any TWO (2) strengths and TWO (2) weaknesses of standard costing in a modern manufacturing context.

(10 marks)

2. Recommend any THREE (3) suggestions whether GreenBrew should retain, adapt, or replace its standard costing system. Justify your suggestions.

(15 marks)

[Total: 25 marks]

Question 4: Short-term Decision Making (25 Marks)

You are the management accountant for CleanSpark Technologies, a medium-sized Malaysian company specializing in solar-powered home devices. The company operates at 90% capacity but has an idle assembly line (Line C) previously dedicated to seasonal promotional products.

A local retailer offers a one-time special order for 30,000 units of a new solar garden light at RM4.50 per unit, with delivery required within 6 weeks. The normal selling price for this product is RM7.00 per unit.

The general manager views this as an opportunity to enter the domestic retail market, but the operations manager warns that accepting the order will delay a scheduled software upgrade for Line C that may cause RM10,000 in extra maintenance expenses over the next six months.

The following unit cost data apply for normal production:

• Direct Material: RM1.20
• Direct Labour: RM1.50
• Variable Overhead: RM0.80
• Fixed Overhead (allocated): RM2.00

Additional information:

• Accepting the order requires overtime for skilled workers at an extra RM0.35 per unit.
• Fixed overheads are committed and will not be affected by this order.
• Line C has the capacity to handle the entire order.

Required:

1. Identify all relevant and irrelevant costs for the decision, including any opportunity or hidden costs. Justify your answers.

(5 marks)

2. Prepare a financial impact analysis for this special order and recommend whether the company should accept it in the short term.

(10 marks)

3. Discuss the ethical and strategic considerations of accepting the special order, focusing on long-term effects on operations, employee morale, and CleanSpark Technologies’ commitment to sustainability.

(10 marks)

[Total: 25 marks]

[TOTAL: 100 marks]

END OF QUESTIONS PAPER

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