Answer any five questions.
1. “Financial accounting treats
costs very broadly, while the cost accounting does this in much greater
detail”. Discuss this with Suitable examples. 10+10=20
2. It is said, “cost accounting is
a system of foresight and not post-mortem examination; it turns losses into
profits, speeds up Activities and eliminates wastes”. Discuss this statement in
detail. 20
3. What do you mean by elements of
cost? Explain the different elements of total cost. 8+12=20
4. (a) A lorry load of materials
of mixed grades was purchased for Rs. 9,000. They were sorted into the
following grades whose Selling price is shown against each:
Units
Selling
price per unit
Grade
A 5,000 Rs1.20
Grade
B 3,000 Rs1.00
Grade
C 2,000 Rs0.50
Find the purchase rate unit of
each grade of the material, assuming all grades yield same rate of profit. 10
(b) What are the essentials of material
control? 10
5. The following is an extract of
the records of the receipts and issues of a chemical during a month.
1
Feb. Opening balance 500 tonnes @ Rs.200
3
Feb. Issued 70 “
4
Feb. Issued 100 “
8
Feb Issued 80 “
13
Feb. Received 200 “@ Rs.190
14
Feb. Returned from
Department 15 “
16
Feb. Issued 180 “
20
Feb. Received 240 “
@ Rs.190
24
Feb. Issued 300 “
25
Feb. Received 320 “
@ Rs.190
26
Feb. Issued 115 “
27
Feb. Returned from
Departments
35 “
28
Feb. Received 100 “
@ Rs.190
Issues are to be priced on the
principle of “First-in-First-out”. The stock verifier has found a shortage of
10 tonnes on the 22nd, And left a note accordingly. Draw up a store
ledger card for the material showing the above transactions. 20
6. (a) From the particulars given
below, calculate earnings of two workers, A and B under straight piece rate
system and Taylor’s
Differential piece rate system:
Standard
time per unit 36 seconds
Normal
rate per hour Rs.3
Differential
rates to be applied:
80%
of piece rate when below standard
120%
of piece rate when at or above standard.
The
workers A and B have produced in a day of 8 hours as follows:
A:
700 units
B:
900 units 10
(b) What are the requisites of a
satisfactory system of labour remuneration? 10
7. A company makes two types of
vehicles, A and B. The total expenses during a period as shown by the books for
the assembly
Of 600 of the type A and, 800 of the type B vehicle are as under.
Rs.
Materials
1,
98,000
Direct
wages 12,000
Stores
overheads 19,800
Running
expenses of machine 4,400
Depreciation 2,200
Labour
amenities 1,500
Works
general overhead 30,000
Administrative
and selling overhead 26,800
The
other data available to you is:
a)
Material cost ratio per unit A : B= 1: 2
b)
Direct labour ratio per unit 2: 3
c)
Machine utilization ratio per unit 1: 2
Calculate the cost of each vehicle
per unit giving reasons for the basis of apportionment adopted by you. 10+10=20
8. Aniance Ltd. Processes a patent
material used in buildings. The material is produced in three consecutive
grades – soft, medium And hard.
Process
I Process II Process III
(a)
Raw material used 1000
tonnes _ _
(b)
Cost per tonne Rs.200 _ _
(c)
Manufacturing wages & exp. Rs.87,
500 Rs.39, 500 Rs.10, 710
(d)
Weight lost (% of input of the process)
5% 10% 20%
(e)
Scrap (Sale price Rs.50 per tonne) 50
tonnes 30
tonnes 51
tonnes
(f)
Sale price per tonne Rs.350 Rs.500 Rs.800
Management expenses were Rs.17,
500 and selling expenses Rs.10, 000. Two third of the output of process I and
one half of the Output of process II is passed on to the next process and the
balances are sold. The entire output of process III is sold. Prepare The three
process accounts and a statement of profit. Make approximations, where
necessary. 10+10