Loyola College B.B.A. Business Administration Nov 2012 Cost Accounting Question Paper PDF Download

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.B.A. DEGREE EXAMINATION – BUSINESS ADMINISTRATION

FIFTH SEMESTER – NOVEMBER 2012

BU 5504/BU 5501 – COST ACCOUNTING

 

 

 

Date : 06/11/2012             Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00

 

PART A

 

Answer ALL questions:                                                                                           (10×2=20 marks)

 

  1. Mention two differences between Bin Card and Stores Ledger.
  2. Define Cost Unit. Give an example.
  3. What is Economic Batch Quantity?
  4. What is a Labour Hour Rate?
  5. Fill in the blanks:
  6. 200 units closing work in progress 60% complete is equal to …………equivalent units.
  7. Staff welfare expenses are apportioned among departments in the ratio of …………
  8. From the following particulars, calculate the economic order quantity.

Annual requirements :  1,600 units

Cost of materials per unit : Rs.40

Cost of placing and receiving one order : Rs.50

Annual carrying cost of inventory : 10% of inventory value.

  1. Rate per hour 1.50 per hour

Time allowed for job      20 hours

Time taken                         15 hours

Calculate the total earnings of the worker under Rowan Plan.

  1. Stock as on 1/1/2010 : 1000 units @ Rs.5 per unit

Purchases on 1/1/2010 : 9000 units @ Rs.6 per unit

Sale during the month : 8000 units

Calculate the value of closing stock on 31/01/2010, assuming the weighted average method of pricing is adopted.

  1. A machine runs for 2000 hours a month, of which 100 hours is for non-production purposes. The fixed expenses of the machine is Rs.3800 per month and the variable expenses are Rs.3.00 per hour when run for production purposes only.

Calculate the machine hour rate.

  1. The joint cost of making 40 units of Product A and 120 units of Product B is Rs.66.The selling price of the products at the split off point are Product A Rs.3 per unit and Product B Rs.2 per unit.

Calculate the share of joint cost of each product, if they are apportioned on sale value basis.

 

 

 

 

 

 

PART  B

Answer ANY FIVE questions                                                                                                                       (5×8=40 marks)

 

  1. Write short notes on:
  2. Labour turnover
  3. Treatment of overtime in Cost Accounts.
  4. Perpetual Inventory system
  5. Retention money
  6. Compare and contrast Financial Accounting with Cost Accounting.
  7. Calculate the earnings of workers A and B under Straight Piece-rate System and Taylor’s Differential Piece-rate System from the following particulars.

Normal rate per hour : Rs.18

Standard time per unit : 20 seconds

Differentials to be applied:

80% of piece rate below standard

120% of piece rate at or above standard.

Worker A produces 1,300 units per day and worker B produces 1,500 units per day.

  1. Calculate the minimum stock level, maximum stock level and re-ordering level from the following information:
  2. Minimum consumption : 100 units per day
  3. Maximum consumption : 150 units per day
  4. Normal consumption : 120 units per day
  5. Re-order period : 10-15 days
  6. Re-order quantity : 1500 units
  7. Normal delivery time : 12 days
  8. From the following data prepare a reconciliation statement and ascertain the profit as per the financial accouts:

Rs.

Profit as per cost accounts                                           1,45,500

Works overheads under-recovered                              9,500

Administrative overheads under-recovered            22,750

Selling overheads over-recovered                               19,500

Overvaluation of opening stock in cost accounts     15,000

Overvaluation of closing stock in cost accounts         7,500

Interest earned during the year                                                      3,750

Rent received during the year                                        27,000

Preliminary expenses written off during the year    27,000

  1. A product passes through 2 processes, A and B before it is completed.

100 units of raw material are introduced in Process A at a cost of RS.10 per unit. Other details relating to the 2 processes are:

Process A                            Process B

Labour                                                                  Rs.400                                   Rs.100

Other expenses                                                               Rs.202                                   Rs.  90

Normal loss as a %age of input                   10                                           20

Sale value of normal loss per unit             Rs.3                                        Rs.4

Output in units                                                  75                                           70

Prepare Process accounts, Abnormal Loss Account and Abnormal Gain Account.

 

  1. The Chennai Transport Co has been given a route 50 kms long to run a bus. The bus costs Rs.4,50,000. It has a life of 5 years and no salvage value. It is insured for 4% per annum and has an annual tax of RS.18,000 per annum. Other details are : Garage rent Rs.4,000 per month; Driver’s salary Rs.6,000 per month; Conductor’s salary : Rs.5,000 per month and office expenses Rs.10,000 per month.

Petrol will cost Rs.100 for 20 kms. The bus will run 3 round trips per day, carrying on an average 40 passengers on each trip. It will run for 30 days in a month.

If the company wants a profit of 20% on takings, what should be the fare per passenger kilometre?

  1. The following information has been obtained from the records of Left-Centre Corporation for the period from January 1 to June 30, 2012.

Rs.                   Rs.

Cost of raw materials                                      30,000             25,000

Cost of work-in-progress                                12,000             15,000

Transactions during six months are:

Purchases of raw materials                              4,50,000

Wages paid                                                     2,30,000

Factory overheads                                               92,000

Administration overheads                                   30,000

Selling and distribution overheads                     20,000

90% of the production was sold @ a profit of 20% on sales.

Prepare statement of Cost and Profit.

 

PART  C

 

Answer ANY TWO questions                                                                     (2×20=40 marks)

 

  1. A company undertook a contract for construction of a large building complex. The construction work commenced on 1st April 2011 and the following data are available for the year ended 31st March 2012.

Rs.                                                                          Rs.

Contract price                                     350,000

Work certified                                     200,000

Progress payments received                150,000           Site Office cost                       10,530

Materials issued to site                                      85,000                       Direct expenses             9,020

Direct wages paid                                 62,500                       Work not certified        1,490

Material returned from site                     2,500

The contractors own a plant which originally cost Rs.20,000 has been continuously in use in this contract throughout the year. The residual value of the plant after 5 years of life is expected to be Rs.5,000. Straight line method of depreciation is in use.

As on 31st March 2012 the direct  wages due amounted to Rs.2,700 and the materials at site were estimated at Rs.2,000.

  1. Prepare the contract account for the year ended 31st March 2012.
  2. Show the Contractee’s account.
  3. Show the relevant balance sheet entries.
  4. Following are the particulars for the production of 2,000 sewing machines of Nath Engineering Co. Ltd., for the year 2011.

Cost of materials Rs.1,60,000; Wages Rs.2,40,000; Manufacturing expenses Rs.1,00,000; Administration expenses Rs.1,80,000; Selling expenses Rs.40,000; Sales Rs.8,00,000.

Prepare a statement of cost and profit for 2011.

The company plans to manufacture 5,000 sewing machines during 2012.

The following additional information is supplied to you:

  1. Price of material is expected to rise by 20%
  2. Wages rates are expected show a decrease of 10%
  3. Manufacturing expenses will rise in proportion to the combined cost of materials and wages.
  4. Selling expenses per unit will remain the same
  5. Other expenses will remain unaffected by the rise in output.

Prepare a statement showing the price at which the machine should be sold in 2012 to earn a profit  of 10% on sales.

  1. The “Modern Company” is divided into four departments: A and B are production departments and X and Y are service departments. The actual costs for a period are as follows:

Rs.                                                                   Rs.

Rent                                        1,000   Supervision                                         1,500

Repairs to plant                           600  Fire insurance in respect of stock            500

Depreciation of Plant                  450  Power                                                      900

Light                                                       350

The following information is available in respect of the four departments:

Dept A                        Dept B                        Dept X                        Dept Y

Area (sq.metres)                      1500                1100                     900                 500

Number of employees                  20                    15                      10                     5

Direct wages (Rs.)                  6000                4000                   3000               2000

Value of Plant (Rs.)                24000              18000              12000                6000

HP of Plant                                    24                    18                    12                     6

Light points                                    15                    10                      5                     5

Direct material                           4000                3000                1500                1000

Value of stock                            1000                  600                  400                  –

 

Apportion Service Dept X’s  expenses between A, B and Y in the ratio of 2:2:1 and Service Dept Y’s expenses between A and B in the ratio of direct wages.

If the estimated machine hour in Departments A and B are 2000 hours and 1800 hours respectively, calculate the Machine Hour Rate for each department.

 

 

 

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