# B.Com II Year (Hons.) Cost Accounting Model Paper I

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1 Max. Marks: 100 B.Com II Year (Hons.) Cost Accounting Model Paper I Durations: 3 Hrs. Attempt all the questions. All Questions are compulsory, each question carry 20 marks. Unit I 1. A Ltd. Is the manufacturer of picture tubes for T.V. and Details of its operation during the year are as follows : Ordering cost 100 per order Inventory carrying cost 20% per annum Cost per tube 520 Minimum usage 50 tubes per week Maximum usage 200 tubes per week Normal usage 100 tubes per week Lead time to supply 68 weeks You are Required to find out following information : (1) Economic Order Quantity. (2) If the supplier is ready to supply the required quarterly consumption of units at a discount of 5 per unit, is it worth accepting? (3) Reorder Level (4) Maximum Level of stock (5) Minimum Level of stock What are the objects of a good system of costing? How does it help the top management in controlling various cost. Unit II 2. (a) Calculate the machine hour rate of a machine with information given below: Operating Data : Total number of weeks per quarter = 13 Total number of hours per week = 48 Stoppage due to maintenance = 4 hrs. per month Time taken for set up = 4 hrs. per week Cost Details: Cost of machine = Rs 2,00,000 Repair & maintenance = 24,000 p.a. Consumable stores = 30,000 p.a. Rent, Rates & Taxes = 8,000 per Quarter Operator s Wages = 3,000 per month Supervisor s Salary = 5,000 per month Cost of Power = 15 units per hour at Rs 3 per unit Additional Information : (i) Life of the machine is 10 years. Depreciation is provided on straight line basis and is treated as variable cost. (ii) Repairs and maintenance and consumable stores are variable costs. (iii) Power is consumed for production runs only for set up maintenance. But cost of power is to be borne by the total time excluding maintenance stoppages. (iv) The supervisor is supervising work on five identical machines including the one now considered. (b) The company hires out excess capacity in the machine shop for outside jobs. Assuming that hire charges are fixed at variable cost plus 20%. What rate should be quoted by the company?

3 Opening Stock Materials Wages Overhead Closing Stock InterProcess profit for Opening Stock 10,000 20,000 14,000 5,000 12,000 21,000 6,000 6,000 2,000 8,000 30,000 16,000 40,000 4,000 2,000 30,000 11,000 Stock in the process is valued at prime cost. The finished stock has been valued at the price at which it was received from process C. Sales of the finished stock amounted to 3,50,000. You are required to prepare the process accounts and finished stock account showing profit element at each stage. Also prepare the profit and loss Account. 5. The following is the standard mix to produce 10 units of a product: A : B : C : During the month of July,2014 ten mixes were completed but the actual out put obtained was only 90 units. Calculate materials variances if the actual consumption of material was as follows. A : B : C : A Company produces a single product and sells it at 200 per unit. The variable cost of the product is 120 per unit and fixed cost for the year is 96,000. You are required to Calculate: (i) P/V Ratio. (ii) Sales at BreakEven point.. (iii) Sales units required to earn a target net profit of 1,20,000. (iv) Sales in units required to earn a target net profit of 1,00,000 after income tax, assuming income tax rate to be 50%. (v) Profit at Sales of 7,00,000.

5 Pressing Polishing Input in Process (units) 12,00 1,000 Unites completed (units) 1, In process (units) Stage of Completion : For Material 100% 100% For Conversion Cost 60% 50% Material Cost () 96,000 8,800 Conversion Cost () 2,87,840 51,975 Prepare a statement of equivalent production and a statement of cost for both the processes. Calculate the selling price per unit to earn a profit of 25% on sales. Distinguish between job Costing and Contract Costing. Can Contract Costing be applied in a factory? State the special features of Contract Costing. 5 Compute the missing data indicated by the question marks from the following information : Particulars A B Standard Price/ unit Actual Price/ unit Standard Output 50 kg.? Actual Input (kgs.)? 70 Material Price Variance?? Material Usage Variance? 300(A) Material Cost Variance?? Material Mix Variance of both materials together was 45 Adverse. The Following is the per unit cost data of a product for normal output and sales of 5,000 units : Direct Material 8 Direct Labour 5 Direct Expenses 4 (20% fixed) Production Overheads: Fixed 2 Variable 3 Selling & Distribution overheads 2 ( 75% Variable) Actual output during the year 2015 was 4,500 units and sales during the same year was 4,300 units. Prepare Cost Statement under: (v) Marginal Costing (b) Direct Costing (c) Absorption Costing (d) Total Costing

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