P/ID 28506/PCMF

OCTOBER 2011

Time : Three hours

Maximum : 100 marks

PART A (10 2 = 20 marks)
Answer ALL questions.

All questions carry equal marks.

Each answer should not exceed 50 words.
1.

Define Cost Accounting.

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2.

State four objectives of Cost Accounting.

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3.

What is Normal Loss?

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4.

Write the formula for calculating Abnormal Loss.

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5.

What is Inter-Process Profit?

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6.

What is Process Costing?

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7.

What is Management Accounting?

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8.

What is Funds Flow Statement?

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9.

What are Financial Statements?

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10.

What do you mean by a Budget?

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PART B (5 6 = 30 marks)
Answer ALL questions.
All questions carry equal marks.
Each answer should not exceed 250 words.
11.

(a)

What are the objectives of Cost Accounting?

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Or
(b)

In process A 100 units of raw materials were introduced at

a cost of Rs. 1,000. The other expenditure incurred by the
process was Rs. 602 of the units introduced 10% are
normally lost in the course of manufacture and the possess
a scrap value of Rs. 3 each. The output of process A was
only 75 units. Prepare process "A" A/C.

. 1,000 AhUP Aih i A &US 100

ASP AkQx. i Cua \P
. 602 Amh ASP 10% Ezv
Hk \un |mhP GvUPkQx. |mh
AS J . 3 u PkQx. i
Hmh
Ezv
75
ASP
i
""A'' PnUPz uUP.
12.

(a)

Distinguish between Cost Control and Cost Reduction.

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E k ?
Or
(b)

Write short notes :

(i)

Fixed budget.

(ii)

Flexible budget.

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(i)

{ vmhmi

(ii)

mh vmhmi
2

P/ID 28506/PCMF

13.

(a)

Write down the three types of scraps?

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Or
(b)

(i)

Calculate break even point from the following :

Sales 1,000 units at Rs. 10 each.
Variable cost Rs. 6 per unit
Fixed cost of Rs. 8,000.

(ii)

If the selling price is reduced to Rs. 9. What is the

new break even point?

(i)

RUPq [Px C |mh \{

PnUQkP.
1,000 ASP . 10 u
\ AQS . 6.
{a \ . 8,000.

(ii)

14.

(a)

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|mh \{ G?

List the objectives of management accounting?

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Or
(b)

From the following particulars you are required to

calculate the average collection period for year 2009.
Total sales Rs. 1,00,000
Cash sales (included above) Rs. 20,000
Sales returns Rs. 7,000
Total debtors on (31.12.2009) Rs. 9,000
Bills receivable on (31.12.2009) Rs. 2,000
Provision for doubtful debts on (31.12.2009) Rs. 1,000
Total creditors on 31.12.2009 Rs. 10,000.
3

P/ID 28506/PCMF

 [Px 2009& BskUP \\ `

Pzu PnUQkP.
zu . 1,00,000
UP (v Eh[Qx) . 20,000
z v . 7,000.
zu Ph 31.12.2009 . 9,000
uS a^mk 31.12.2009 . 2,000
IUPh JxUS 31.12.2009 . 1,000
zu Phu 31.12.2009 . 10,000.
15.

(a)

What are the benefits of ratio analysis?

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Or
(b)

From the following Information relating to Siva Ltd,

calculate funds lost in operations.
Net loss for the year Rs. 90,000
Dividend received Rs. 7,000
Depreciation charged Rs. 10,000
Profit on sale of asset Rs. 5,000
Refund of tax Rs. 2,000.

RUPq [P Psk
\mk {v |mhzu PnUQkP.

{zv

{P |mh . 90,000
[Pu x . 7,000
u . 10,000
\zxUP v C . 5,000
v x . 2,000.
4

P/ID 28506/PCMF

PART C (5 10 = 50 marks)
Answer ALL questions.
All questions carry equal marks.
Each answer should not exceed 500 words.
16.

(a)

Explain the advantages of Cost Accounting.

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Or
(b)

A product passes through two distinct processes A and B

and there after, it is transferred finished stocks. From the
following information you are required to prepare processes
accounts :
Particulars
Process Process
A

Material (Rs.)

12,000

6,000

Direct labour (Rs.)

14,000

8,000

4,000

4,000

Input in process A (tonns)

10,000

Input in process A (value) Rs.

10,000

9,400

8,300

5%

10%

10

Manufacturing expenses (Rs.)

Output (tonns)
Normal wastage (percentages)
Value of normal wastage (per 100 units) Rs.

J Ezv C P A
B Phx

AhQx.
R
PkUPmk
[PU Psk PnUSP u \.
[P

A

(.)

12,000

6,000

|iU T (.)

14,000

8,000

4,000

4,000

i A & E\zxu (h)

10,000

i B & E\zxu (.)

10,000

9,400

8,300

5%

10%

10

Ezva \P (.)

Ezv (hP)
\un |mh (\uu)
\un |mhzv v (100 AQS .)
5

P/ID 28506/PCMF

17.

(a)

Difference between Job Costing and process Costing.

o AhUP US, i AhUP

US E kP GxP.
Or
(b)

Following are the ratios, relating to the trading activities of

National Traders Ltd.
Debtors Velocity 3 months
Stock velocity 8 months
Creditors velocity 2 months
Gross profit ratio 25%.
Gross profit for the year ended 31.12.2008 amounted to
Rs. 4,00,000. Closing stock of the year is Rs. 10,000 above
the opening stock. Bills receivable amount Rs. 25,000 and
bills payable to Rs. 10,000. Find out
(i)

Sales

(ii)

Sundry debtors

(iii) Closing stock and

(iv)

Sundry creditors.

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Qu[P :
PhP _ P 3 u[P.
\UQ _ P 8 u[P
Phu _ P 2 u[P
zu C Qu 25%
31.12.2008 & ihu Bsi zu C
. 4,00,000. Cv \UQ B \UQ h
. 10,000 AvP. US a^mk . 25,000,
\zxuS a^mk . 10,000.
(i)

(ii)

PhP

(iii) Cv \UQ
(iv)

Phu BQU PnUQkP.

6

P/ID 28506/PCMF

18.

(a)

What is budgetary control? What are its advantages?

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Or
(b)

The following details are available from a company

31.12.07

31.12.08

31.12.07

31.12.08

Rs.

Rs.

Rs.

Rs.

9,000

7,800

Debtors

14,900

17,700

Share capital

70,000

74,000

Debentures

12,000

6,000

700

800

Stock

49,200

42,700

Trade creditors

10,360

11,840

Land

20,000

30,000

P & L A/C

10,040

10,560

Good
will

10,000

5,000

1,03,100

1,03,200

1,03,100

1,03,200

Reserve and
surplus

Cash

In addition you are given :

(i)

Dividend paid total Rs. 3,500.

(ii)

Land was purchased for Rs. 10,000

(iii) Amount

provided

for

Amortisation

Goodwill

Rs. 5,000.
(iv)

Debentures paid off Rs. 6,000.

Prepare cashflow statement.

J {zv [P R PkUPmk
31.12.07 31.12.08
.
[Su

70,000

Phmk zv

12,000

31.12.07 31.12.08

.
74,000 UP
6,000 PhP
7

9,000

7,800

14,900

17,700

P/ID 28506/PCMF

31.12.07 31.12.08
.
P () E

700

31.12.07 31.12.08

800 \UQ

49,200

42,700

Phu

10,360

11,840 {

20,000

30,000

C |mh P/S

10,040

10,560 |

10,000

5,000

1,03,100 1,03,200

1,03,100 1,03,200

Czxh \zx u[PUS PkUPmh

(i)

[Pu \zvx . 3,500.

(ii)

{, Pu \ux . 10,000.

(iii) | Gv }UQx . 5,000

(iv)

Phmk zv va \zvx . 6,000,

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uUP.

19.

(a)

Explain the functions of management accounting.

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Or
(b)

Draw up a flexible budget for production at 75% and 100%

capacity on the basis of the following data for a 50%
activity.
Details
Per units
Rs.

Materials

100

Labour

50

Variable expenses (direct)

10

Administrative expenses (50% fixed)

40,000

Selling and distribution expenses (60% fixed)

50,000

Present production (50% activity)

8

1000 units

P/ID 28506/PCMF

50% \mi AihPU Psk 75% 100%

P E EzvUP |Qz u vmhmi
P.
[P

J AQS
.

mP

100

50

k \ (|ix)

10

{Pa \ (50% {x)

40,000

Q \P (60% {x)

50,000

uu Ezv (50% \k)

20.

(a)

1000 ASP

From the following information compute :

(i)

Material price variance.

(ii)

Material usage variance

(iii) Material mix variance.

Material Quantity units Standard std - unit price Total
Rs.

Rs.

16

Material Quantity units Actual Actual unit price Total

Rs.

Rs.

3.50

7.00

2.00

2.00

3.00

9.00

18

\vPU Psk
(i)

mi

(ii)

mk mi

(iii) P mi PnUQkP.
9

P/ID 28506/PCMF

 A ASP {x { zu
J AQS .

16

A ASP Esx Es zu
J AQS .

3.50

7.00

2.00

2.00

3.00

9.00

18
Or

(b)

What are the Merits and Demerits of Standard Costing?

vmha \ |P wP ?

10

P/ID 28506/PCMF