Loyola College B.B.A. Business Administration Nov 2008 Cost Accounting Question Paper PDF Download



OA 10


FIFTH SEMESTER – November 2008





Date : 07-11-08                     Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00


SECTION –A                                                (10X2=20 MARKS)

Answer all the questions:

  1. What is cost sheet?
  2. What do you mean by Defectives?
  3. Define inventory control?
  4. How do you classify overheads?
  5. What is process costing?
  6. Calculate the total earnings of a worker under Halsey plan

Standard time        – 30 hours

Time taken             – 20 hours

Hourly rate of wages is Re 1 per hour plus D.A @ 50 paise per hour worked.

  1. Find out the economic order of quantity with the help of following details :-

Monthly usage                                                       : 500 units

               Cost of materials per unit                                         : Rs 20

               Cost of placing and receiving one order                  : Rs 60

         Annual carrying cost                                          : Rs 2 per unit

  1. Compute the depreciation chargeable to each department:

Depreciation Rs 27500

Machinery value in the departments:

X- Rs 200,000,      Y- Rs 400,000,            Z- Rs 500,000.

  1. Calculate profits as per financial accounts

Profit as per cost accounts                                    Rs. 60,000

Overheads recovered in costing                            Rs. 3,500

Under absorption of expenses in costing              Rs. 6,000

Income tax debited in financial                            Rs. 4000


  1. Calculate the materials purchased during the year


                  Direct wages                                                         60,000

                  Prime cost                                                             110.000

                 Opening stock of raw materials                             20,000

                 Closing stock of raw materials                               25,000

                 Expenses on purchase                                            15,000



SECTION- B                                     (5×8=40 marks)

            Answer any 5 questions:-

  1. What are the effects of labour turn over?
  2. What are the limitations of cost accounting?
  3. Explain ABC analysis? What are its advantages?



  1. From the following, prepare stores ledger under FIFO method:

JAN 1 opening balance at Rs 5 each

2 received 500 units of Rs 4each

10 issued 300 units

15 issued 200 units

26 received 500 units of Rs 5.50 each

27 issued 300 units

31 issued 250 units

  1. From the following information, calculate kilometers and total passenger kilometers:

No . Of buses                                : 4

Days operated in a month             : 30

Round trips made by each bus      : 4

Distance of route                          :30 km long (one way)

Capacity of bus                             : 60 passengers

Normal passengers traveling         : 80% of the capacity

  1. Calculate re-ordering level, minimum stock level , maximum stock level and average stock level:

Maximum consumption                – 150 units per day

Minimum consumption                 – 100 units per day

Normal consumption                     – 120 units per day

Re-order period                             – 10-15 days

Re- order quantity                         – 1500 units

Normal re- order period                – 12 days


  1. Work out the normal and over time wages payable to a worker from the following:

                        Days                            Hours worked

                        Monday                                   8

                        Tuesday                                   10

                        Wednesday                              9

                        Thurs day                                11

                        Friday                                    9

                        Saturday                                  4

            Normal working hours                        – 8 hours per day

            Normal rate                                         – Rs 2 per hour

            Over time rate                                     – double the usual rate

  1. Compute the machine hour rate from the following :

Cost of machine                                        : Rs 10,000

Scrap value after 10 years                         : Rs 2,000

Rent for a quarter for the department       : RS 300

General lighting                                        : Rs 240 p.a

Department supervisor’s salary                 : Rs 600 per quarter

Insurance premium for machine                : R s 60 p.a

Repairs                                                      : Rs 100 p.a

Power 2 units per hour at Rs 5 per 100 units

Estimated working hours p.a 2000

Machine occupies 1/4th of the total area in the department .The supervisor devotes 1/6th time for this machine.







SECTION- C                                                 (2X20= 40 MARKS)

Answer any two questions:

  1. From the following, prepare a cost sheet.

Materials                           – Rs 80,000

Direct wages                     – Rs 48,000

Machine hours worked     – 8,000

Machine hour rate             – Rs 4

Office overheads              – 10% on work cost

Selling overheads              – Rs 1.50 per unit

Units produced                 – 4000

Units sold                          – 3,600 units @ Rs 50 each


  1. A product passes through 3 stages from the following prepare process accounts and abnormal gains and abnormal loss a/c
Particulars   Process  
   I (Rs) II (Rs) III (Rs)
Raw material 2600 1980 2962
Direct wages 2000 3000 4000
Selling price of scrap

(Per Unit)

2 4 5
Normal loss 5% 10% 15%
production 950units 840 units 750 units


General expenses Rs 9,000 which absorbed on the basis of wages . 1000 units at Rs 3 each introduced into process I.

  1. A company’s informations related to a contract are given below. Prepare a contract account and also show how entries appear in balance sheet of the company:

Particulars                                                              Rs

Materials sent to site                                             85,349

Labour engaged on site                                         74,375

Plant installed at site                                             15,000

Direct expenditure                                                            3,167

Establishment charges                                           4,126

Materials returned to stores                                  549

Work certified                                                       195,000

Cost of work not certified                                     4,500

Material in hand at the end of year                       1,883

Wages accrued for the year                                  2,400

Direct expenses accrued                                       240

Value of plant at the end of the year                    11,000

Contract price agreed                                            250,000

Cash received                                                        180,000



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Loyola College B.B.A. Business Administration Nov 2010 Cost Accounting Question Paper PDF Download








Date : 03-11-10                     Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00



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


Explain the following:

  1. Equivalent units
  2. Opportunity cost
  3. Abnormal loss and Abnormal gain
  4. Work certified and Retention money
  5. State the basis for apportioning the following expenses to different departments:
  6. Power
  7. Canteen expenses
  8. C) Stock insurance
  9. d) Crèche expenses
  10. The works cost of a product is Rs.8000. factory overheads are Rs.1000, which is 50% of wages. Calculate the value of direct material used.
  11. Standard time 10 hours, time taken 6 hours, time rate Rs.5 per hour. Calculate the earnings of a worker under Halsey and Rowan plan.
  12. Calculate economic order quantity and the number of orders to be placed in a year from the following data:

Annual consumption 10000 kg; ordering cost per order Rs.50; cost per kg Rs.2; storage expenses 8% per annum on inventory.

  1. From the following data compute the cost per unit assuming a batch of 1000 units are produced:

Material – Re 1 per unit. Each unit takes 10 minutes to produce.

Machine operator is paid Rs.12 per hour. The machine hour rate is Rs.1.50.

The setting up time for the machine is 1 hour.

  1. Profit as per financial accounts Rs.2000.

Works overheads under  recovered in cost – Rs.12000

Transfer fees in financial accounts – Rs.1000

Calculate the profit as per Cost Accounts.




Answer any FIVE questions:                                                                                                 (5×8=40 marks)


  1. What are the benefits obtained by installing a Costing system? What are the practical difficulties in installing the system?


  1. What is labour turnover? What are its causes and costs?


  1. X Ltd undertook a contract for Rs.6,50,000 on 1st April 2009. The following details relate to the contract for the year ending 31st December 2009.

Materials issued Rs.1,80,000

Wages paid Rs.87,000

Other expenses Rs.38,750

Plant issued to contract Rs.32,000

Total establishment expenses amounted to Rs.40000, out of which 25% is chargeable to the contract. Out of the materials issued, materials costing Rs.4,000 were sold for Rs.5,000. Plant costing Rs.2,000 was damaged on 1st October 2009 and was sold as scrap for Rs.300. Plant is to be depreciated at 10% per annum.

Material at site on 31st December 2009 was Rs.17,500.

Cash received from contractee Rs.3,06,000 which is 90% of work certified.

Work uncertified on 31st December 2009 Rs.30,000.

Prepare the contract account.

  1. A transport company runs a bus between two towns which are 100 kms apart. The seating capacity of the bus is 40 passengers. It carries full capacity on the upward journey but only 75% of the capacity on the return journey. Bus runs for 30 days in a month and makes one round trip every day. The following details relate to the month of April 2010:

Wages of driver and conductor                        Rs.9,000

Diesel and oil                                                           Rs.18,000

Repairs and maintenance                                   Rs. 8,000

Garage rent                                                              Rs.2,000

Taxes and insurance                                             Rs.24,000 per annum

The bus costs Rs.4,00,000 and has a life of 10 years with an estimated scrap value of Rs.40,000.

Calculate the cost per passenger km.  Also calculate the fare per passenger kilometer, if the company wants a profit of 50% on the fare.


  1. A factory is engaged in the production of a chemical X and in the course of its manufacture, a by-product Y is produced, which after a separate process has a commercial value. For the month of January 2009, the following are the summarized cost data:

Joint expenses                 Separate expenses

X                             Y

Rs.                          Rs.                          Rs.

Materials                                                                                     29,200                   8,360                     1,780

Labour                                                                                          14,700                   5,680                     2,042

Overheads                                                                                    3,450                   1,500                        544

The output for the month was 150 tonnes of X and 50 tonnes of Y and the selling price of X was Rs.500 per tone and that of Y Rs.290 per tone.

Assuming that the profit of Y is estimated at 25% of the selling price, prepare a statement showing the profit made on Product X.


  1. The following details relate to the year 2004:

Material Rs.100000

Labor Rs.50000

Direct expenses Rs.20000

Factory overheads Rs.25000

Administration overheads Rs.39000

Selling overheads Rs.19500

Sales Rs.278850

During the year 2005 the company received a work order which requires, Material Rs.8000, Labor Rs.4000 and Direct expenses Rs.1500. What price should the company quote for this order, if it wants the same rate of profit on selling price as was realized in the year 2004? Assume factory overheads are recovered as a percentage of direct labor and administration and    selling overheads as a percentage of works cost.


  1. From the following information, calculate a composite machine rate, for a machine whose scrap value is Rs.20,000.
  2. Cost of machine 3,80,000
  3. Installation charges                 40,000
  4. Working life                                 10 years
  5. Working hours                                 8000 per year
  6. Repair charges                 40% of depreciation
  7. Power                 10 units per hour at 40 paisa per unit.
  8. Lubricating oil                 4 per day of 8 hours
  9. Consumable stores                 10 per day of 8 hours
  10. Machine operator’s wages                 20 per day


  1. In a factory, there are two Production depts., A and B, and two Service depts., X and Y. the overhead expense of these four depts. are as follows:

A – Rs.6,780; B – Rs.6,020; X – Rs.1,200 and Y Rs.1,000

The expenses of the Service Dept are to be divided between the other departments on the following percentage basis:

Dept. X                       Dept A 50%                         Dept B 30%                         Dept Y 20%

Dept. Y                       Dept A 50%                         Dept B 50%                         –

  1. Prepare a statement showing the distribution of the Service dept expenses to the Production dept.
  2. Dept A absorbs overheads at a rate per labor hour and Dept B at the rate per machine hour. The estimated labor hours and machine hours in the respective depts. are 2000 hours and 1000 hours respectively.

Calculate the overhead recovery rates for the two departments.

  1. Calculate the price to be quoted for a job that requires Rs.500 in material, Rs.200 in wages and uses 6 Labor hours in Dept A and 4 machine hours in Dept B.

The company wants a profit of 50% on selling price.




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


  1. The following details are supplied by an oil distributing company for the month of October 2009.

Stock on 1st October 2009 – 2000 litres at Rs.5 per litre

Receipts for the month:

7th                 1000 litres at Rs.6 per lt.

15th               2000 litres at Rs.6.50 per lt

Issues during the month:

10th               2500 litres

31st               2200 litres

On 31st October 2009 a shortage of 100 litres was noticed.

Prepare Stores Ledger under:

  1. FIFO method
  2. Weighted Average method.


  1. From the following data calculate: (a) Equivalent production, (b) Cost per unit of equivalent production; and

(c) Statement of apportionment of cost , (d) Prepare the Process A account.

No. of units introduced in the process A                                      4,000 units

No. of units completed and transferred in Process B             3,200 units.

No. of units in process at the end of the period                          620 units.

Stage of completion:

Material                                     80%

Labour                                        70%

Overheads                                                70%

Normal process loss at the end of the process                          200 units

Value of scrap                                                                                         Re.1 per unit

Value of raw materials                                                                         Rs.11,228

Wages                                                                                                        Rs.7,228

Overheads                                                                                                                Rs.3,614


  1. The following figures relate to R Ltd. for the year ending 31st  March 2007:

Financial A/cs (Rs.)                          Cost A/cs (Rs.)

Opening Stock:

Raw material                                                            8000                                                       5000

Work in progress                                                    7000                                                       8500

Finished stock                                                         5000                                                       4500

Closing Stock:

Raw material                                                            3000                                                       4500

Work in progress                                                    3000                                                       4700

Finished stock                                                         6900                                                       6200

Purchases                                                                 40000                                                    40000

Direct wages                                                            20000                                                    20000

Factory overheads                                                                18000                                                    21000

Administration overheads                                 3000                                                       2300

Selling overheads                                                  4000                                                       4500

Loss on sale of assets                                           1000                                                       –

Interest and dividend received                        1600                                                       –

Sales during the year was Rs.1,20,000.

Calculate the profit in Financial A/cs and Cost A/cs and prepare a statement reconciling the two profits.

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Loyola College B.B.A. Business Administration April 2011 Cost Accounting Question Paper PDF Download








Date : 19-04-2011              Dept. No.                                          Max. : 100 Marks

Time : 1:00 – 4:00



Answer ALL questions                                                                                  Marks:10×2=20


Explain the following:


  1. Rowan plan
  2. Absorption of overheads
  3. Equivalent units
  4. Economic batch quantity
  5. Fill in the blanks:
  6. By products are always of lower value and importance than the ———–product.
  7. Rent of building is apportioned on the basis of ————-.
  8. Minimum consumption 150 units per week; maximum consumption 350 units per week; reorder period 2-4 weeks; reorder quantity 1000 units. Calculate maximum level and minimum level.
  9. Profit as per financial accounts Rs.4000;

Factory overheads under-absorbed in cost accounts Rs.8000;

Closing stock over-valued in financial accounts Rs.3000.

Calculate profit as per Cost accounts

  1. Standard time per unit 12 minutes; standard rate per hour Rs.60; differential to be used 80% and 120%. In a day of 8 hours A produced 50 units. Calculate his earnings under Taylors differential piece rate system.
  2. Annual demand for a component is 6000 units. Setting up cost per batch Rs. 20; annual rate of interest 6%; cost of manufacture per unit Rs.100. Calculate Economic Batch quantity.
  3. Calculate the amount of profit to be taken to P and L account.

Notional profit Rs.60000; cash received Rs.6,40,000 being 80% of works certified; contract price Rs.16,00,000. Calculate the profit to be credited to P and L account




Answer ANY FIVE questions                                                                       Marks:5×8=40


  1. a) Distinguish between Bin Card and Stores Ledger.
  2. Write a note on ABC stock control.


  1. Differentiate between financial accounting and cost accounting.


  1. The following annual charges are incurred in respect of a machine in a shop where work is done by means of 5 similar machines.

Rent for the shop Rs.4800

Depreciation on each machine Rs.500

Repairs for 5 machines Rs.1000

Lighting charges for the shop Rs.540.

Sundry supplies for the shop Rs.450

There are two attendants for the 5 machines and they are each paid Rs.60 per month. There is one supervisor for the 5 machines who is paid Rs.250 per month.

Machine uses 10 units of power per hour at 50p per unit.

Calculate the machine hour rate, assuming each machine works for 1200 hours per annum.


  1. Fast Roadways run 10 buses between two suburban centres which are 25 kilometres apart. Seating capacity of each bus is 30 passengers. The expenses for the month of March 2010 were as under:


Salaries of drivers and conductors                        60,000

Salaries of mechanical staff                                  36,000

Taxes, insurance, etc.                                            20,200

Repairs and maintenance                                      28,000

Diesel and oil cost Rs.8 per litre. The vehicle runs 16 kms per litre. The cost of the vehicle is Rs.6,20,000. It has a life of 5 years and a salvage value of Rs.20,000 at the end of its life. Seating capacity utilised was 60%. All the buses ran 25 days a month. Each bus made four round-trips daily.

Find out the cost per passenger kilometre and the cost per round trip per passenger.


  1. The following are the particulars relating to a contract which has begun on 1st January 2010:


Contract price                                          5,00,000

Machinery                                                     30,000

Materials                                                   1,70,000

Wages                                                       1,48,750

Direct expenses                                              6,330

Outstanding wages                                        5,380

Uncertified  work                                          9,000

Overheads                                                      8,240

Materials returned                                          1,600

Materials on hand 31st December 2010         3,700

Machinery on hand 31st December 2010     22,000

Value of work certified                            3,90,000

Cash received                                            3,51,000

Prepare the Contract Account for the year 2010 showing the amount of profit that may be taken to the credit of Profit and Loss A/c of the year. Also show the amount of the work-in-progress as it would appear in the balance sheet of the year.


  1. Compute the reorder level, minimum level, maximum level and average stock level for the component A based on the following data:

Maximum consumption per week                        150 units

Average consumption per week                           100 units

Minimum consumption per week             50 units

Reorder period                                                     8 to 12 weeks

Annual consumption                                            4000 units

Ordering cost per order                                         Rs.5

Cost per unit                                                         Rs.2

Storage and carrying cost                                     8% of annual inventory








  1. A factory is engaged in the production of a Chemical X and in the course of its manufacture a by-product Y is produced, which after a separate process has a commercial value. For the month of January, the following are the summarised costing data:

Joint expenses                         Separate expenses

(Rs)                                  X (Rs)                    Y (Rs)

Materials                                       19,200                             7,360                                      780

Labour                                           11,700                             7,680                                   2,642

On cost                                            3,450                             1,500                                       544

The output for the month was 150 tons of X and 49 tons of Y and the selling price of Y averaged Rs.280 per ton.

Assuming that the profit on Y is estimated at 50% of the selling price, calculate the profit on X if its selling price is Rs.400 per tonne.


  1. Net profits of Mayur Industries for the year ended 31.12.2010 as per Cost Account was Rs.1,60,000. However, financial records showed a different net profit. Scrutiny  of the books of accounts revealed the following information:


Interest on investments                                                                                         10,000

Income tax provided                                                                                             48,000

Loss due to obsolescence                                                                                      6,800

Bank interest and transfer fees in financial accounts only as expenditure             1,250

Share transfer fees received                                                                                    6,750

Depreciation charged in financial accounts                                                          18,650

Depreciation charged in cost accounts                                                                 21,250

Works overhead under recovered in cost accounts                                                3,540

Closing stock under-valued in financial accounts                                                  1,410

Prepare a reconciliation statement and show the amount of net profit as per financial accounts.




Answer ANY TWO questions                                                                      Marks:2×20=40


  1. Usha Engineering Works Ltd., manufactured and sold 1,000 sewing machines in 2010. Following are the particulars obtained from the records of the company:


Cost of materials                                          80,000

Wages paid                                               1,20,000

Manufacturing expenses                              50,000

Salaries                                                         60,000

Rent, rates and insurance                             10,000

Selling expenses                                           30,000

General expenses                                         20,000

Sales                                                          4,00,000

Prepare a statement of Cost and Profit for the year 2010.

The company plans to manufacture 1200 sewing machines in 2011. You are required to submit a statement showing the price at which machines would be sold so as to show a profit of 10% on the selling price. The following  additional information is supplied to you:

  1. The price of materials will rise by 20% on the previous year’s level.
  2. Wage rates will rise by 5%.
  • Manufacturing expenses will rise in proportion to the combined cost of materials and wages.
  1. Selling expenses per unit will remain unchanged.
  2. Other expenses will remain unaffected by the rise in output.


20   Prepare Process accounts, Normal Loss, Abnormal loss and Abnormal Gain accounts from the   following details:

Process No.1               Process No.2

Materials  (Rs)                             30,000                            3,000

Labour (Rs)                                 10,000                         12,000

Overheads (Rs)                             7,000                           8,600

Inputs (units)                               20,000                         –

Output of the process                 17,500                         17,000

Normal loss on input                   10%                             4%

Sales value of scrap per unit       Re.1                             Rs.2


  1. In a manufacturing concern there are four departments viz. A, B, C and D.

A and B are Production Departments and C and D are Service Departments. C renders service worth Rs.12,000 to D and balance to A and B in the ratio of 3:2. D renders service to A and B in the ratio of 9:1.

The overhead expenses incurred in a year are as follows:

Depreciation                                  Rs.95,000

Rent, Rates and Taxes                  Rs.18,000

Insurance                                       Rs.   7,600

Power                                            Rs.10,000

Canteen expenses                          Rs.   5,400

Electricity                                      Rs.   2,400

Following further information are given regarding the departments:

A                     B                     C                     D

Direct materials (Rs)                       6,000              5,000              3,000             2,000

Direct  labour (Rs)                        20,000             10,000             10,000             5,000

Floor space occupied (sq.ft)            5,000               4,000               1,000             2,000

Value of assets (in lakhs)                      10                     5                       3                    1

H.P. of machines                             1,000                  500                  400                 100

No. of workers                                   100                    50                    50                   25

Light and fan points                            50                    30                    20                   20

From the above particulars prepare a Statement showing overhead expenses of Production Departments A and B after redistribution of Service Department expenses. Also calculate the overhead recovery rate if it is based as a percentage on labour.



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








Date : 30-04-2012              Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00


                                                                    SECTION – A 

ANSWER ALL QUESTIONS:                                                                                   (10×2 = 20marks)


  1. What is a cost sheet?
  2. What is Bin Card?
  3. What is Merit Rating?
  4. What is ‘under-absorption’ of overheads?
  5. Explain ‘Escalation Cause’.
  6. Compute the prime cost:         Rs.

Direct Material used                                         82,000

Productive wages                                              17,000

Royalty paid                                                      11,000

Hire charge of special machines foe the job       13,000

  1. Find out the Economic Order Quantity from the following particulars:

Annual usage                                               6,000 units

Cost of placing per unit                                Rs.20

Cost of placing and receiving one order:Rs. 60.  Annual carrying cost of one unit: 10% of Inventory


  1. Mr.A a worker in a factory is paid on time basis. During the month of October 2010 he has worked

for 200 hours.  His hourly wage rate is Rs.10 per hour.

Mr.B another employee of the company is paid on the basis of piece wages.  During the month of

January 2010 his output was 1,000 units.  Rate of wages per piece is Rs.3.

Calculate the wages of respective workers for the month of October 2010.

  1. The works overheads of a department are Rs.3,00,000.

The direct wages are 3,00,000

The direct material cost is 9,00,000.

Ascertain the prime cost percentage rate of works overhead.

  1. A company produces 300 units of product R, 200 units of product ‘S’ and 100 units of product J from

a single process.  The costs upto the point of separation amounted to Rs.30,000.  You are required to

apportion the joint cost of production among the products, using the average unit cost method.



Answer any FIVE  questions:                                                                              (5 X 8 = 40 marks) 


  1. Discuss the advantages of Cost Accounting.
  2. Explain the causes of labour turnover.
  3. Compute the various stock levels from the following data:

Maximum consumption in a month     300 units

Minimum usage in a month                  200 units

Average usage in a month                    225 units

Time-lag for procurement of materials:

Maximum 6 months ;  Minimum  2 months;  Reorder quantity   750 units.




  1. The following details pertain to the production department of a factory.

Material consumed                                                                               Rs.60,000

Direct wages                                                                                         Rs.40,000

Machine hours                                                                                      Rs.50,000

Labour hours worked                                                                            Rs.25,000

Factory overhead relating to the department                                         Rs.50,000

Calculate  overhead absorption rates under different possible method from the above detail.


  1. Laxmi Travels, a transport company is running a fleet of six buses between two towns 75 kms apart.

The seating capacity of each bus is 40 passengers.  The following particulars are available for the

month of April 2005.


Wages of Drivers, Conductors, etc                                                                        3,600

Salaries of office and supervisory staff                                                                  1,500

Diesel oil, etc                                                                                                        10,320

Repairs and maintenance                                                                                       1,200

Taxes and insurance                                                                                               2,400

Depreciation                                                                                                           3,900

Interest and other charges                                                                                       3,000

The actual passengers carried were 80% of the capacity.  All the buses run all the days in the

month.  Each bus made one round trip per day.

Find out the cost per passenger kilometre.


  1. The following are the expenses of Balaji & Co., in respect of a contract which commenced on 1st

January 2008.


Materials purchased                                                                   50,000

Materials on hand                                                                         2,500

Direct wages                                                                               75,000

Plant issued                                                                                 25,000

Direct Expenses                                                                          40,000

The contract price was Rs.7,50,000 and the same was duly received when the contract was completed in August 2008.  Charge indirect expenses at 15% on wages; provide Rs.5,000 for depreciation on plant and prepare the contract account.


  1. From the following particulars calculate the earnings of workers A & B under straight piece rate

system and Taylor’s differential piece rate system.

Standard time allowed 25 units per hour

Normal time rate Rs.50 per hour

Differentials to be applied

80% of piece rate when below standard

120% of piece rate at or above standard

In a day of 8 hours A produced 150 units and B produced 250 units.


  1. The cost accounts department of a company has supplied the following data for the supply of 2,000

units of product.

Direct materials:  40,000 tons at Rs.5 per ton.

Direct wages      :   8,000 labour hours at Rs.50 per hour


Variable:               Factory Rs.10 per labour hour

Selling Rs.20 per unit

Fixed:                    Factory Rs.1,00,000

Office   Rs.2,00,000

Prepare a Statement showing the price to be fixed which will fetch a profit of 25% on cost.





Answer any TWO questions:                                                                                   (2 X 20 = 40 marks) 


  1. From the following data, prepare a cost and production statement of Popular Stove Manufacturing

Company for the year 2010.


Stock of materials on 1-1-2010                                                            35,000

Stock of materials on 31-12-2010                                                          4,900

Purchase of materials                                                                           52,500

Factory wages                                                                                       95,000

Factory expenses                                                                                   17,500

Establishment expenses                                                                         10,000

Completed stock in hand on 1-1-2010                                                      NIL

Completed stock in hand on 31-12-2010                                                35,000

Sales                                                                                                     1,89,000

The number of stoves manufactured during the year was 4,000.

The company wants to quote for a contract for the supply of 1,000 electric stoves during the year 2011.

The stoves to be quoted are of uniform quality and make, and are similar to those manufactured in the

previous year; but the cost of material has increased by 15% and cost of factory labour by 10%.

Prepare a statement showing the price to be quoted to give the same percentage of net profit on

turnover as was realised during the year 2010 assuming that the cost per unit of overhead charges will

be the same as in the previous year.


  1. Make out the necessary accounts from the following details:

Process A                            Process B

Rs.                                     Rs.

Materials                                                                       30,000                                 3,000

Labour                                                                           10,000                               12,000

Overheads                                                                       7,000                                 8,600

Input (units)                                                                  20,000                               17,500

Normal loss                                                                       10%                                    4%

Sales of waste per unit                                                    Rs.1                                    Rs.2

There was no opening or closing stock or work-in-progress.  Final output from process B was 17,000



  1. In a Light Engineering Factory, the following particulars have been collected for the three monthly

period ended 31-12-2008.  Compute the departmental overhead rates for each of the production

departments, assuming that overheads are recovered as a percentage of direct wages.





Production Departments


Service departments

    A       B     C        D      E
Direct wages (Rs.)

Direct materials

Staff (Nos.)

Electricity (Kwh)

Light points (Nos.)

Assets value  (Rs.)

Area occupied (Sq.mts.)






































The expenses for the period were:

Rs.                                                                                         Rs.

Motive power                                          550                Amenities to staff                                          1,500

Lighting power                                        100                Repairs and maintenance                               3,000

Stores overhead                                       400                 General overhead                                           6,000

Depreciation                                        15,000               Rent and taxes                                                    275

Apportion the expenses of service department E proportionate to direct wages and that of service department D in the ratio of 5:3:2 to departments A, B and C respectively.




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








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

Time : 9:00 – 12:00




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.








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:


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.




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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Loyola College B.A. Corporate & Secretaryship Nov 2003 Cost Accounting Question Paper PDF Download






III  B.A. (Corporate)                                                                                                                               Max. Marks  :  40 marks

Date : 16/10/2003                                                                                                                  Time  :  5.15 – 6.45 p.m.




Answer any THREE questions:                                                                                         ( 3 x 8 = 24 )


  1. The following details pertain to the Production Department of XYZ Ltd;


Material Consumed             –               Rs.45,000

Direct Wages                        –               Rs.60,000

Overheads                             –               Rs.90,000

Direct Labour Hours            –               15,000  hours

Machine hours                     –               30,000  hours


Find out different overhead absorption rates.


  1. Work out the MHR for the following Machine whose scrap value is Nil.


  1. Cost of Machine Rs.3,60,000.
  2. Fright and installation Rs.40,000.
  • Working Life – 10 years
  1. Working hours :  8,000 per year
  2. Repair Charges : 50% of depreciation.
  3. Power :  10 units per hour @ 10 paise per unit.
  • Lubricating Oil @ Rs.2 per day of 8 hours.
  • Consumable stores @ Rs.10 per day of 8 hours.
  1. Wages of operator @ Rs.4 per day.



  1. Describe various reasons which cause difference between the profits disclosed by cost & financial accounts.


  1. From the following data valuing to vehicle ‘X’ compute the cost per running km.



Cost of Vehicle                     –               25,000

Road License (Annual)       –                    750.

Insurance (Annual)             –                    700

Garage rent (Monthly)        –                      50

Supervision & Salaries (Monthly)  –     100

Driver Wages per hour       –                        3

Cost of Petrol per Litre        –                        3

Repairs & Maintenance per km.        –        1.65

Tyre allocation per km.        –                        0.80

Estimated Life of vehicle (kms)-  1,00,000

Kilometres run (annual)      –               15,000

Kilometres run per litre        –                       20

The vehicle runs 20 km. per hour on an average.



  1. What is escalation clause? ( 2 marks )

Distinguish between job costing and Contract Costing.                    ( 6 marks )





Answer any ONE question:                                                                                                             ( 1 x 16 = 16 )


  1. a) How much Profit, it any, you would allow to be considered in the following case.

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Loyola College B.A. Corporate & Secretaryship April 2007 Cost Accounting Question Paper PDF Download



HO 10






Date & Time: 28/04/2007 / 1:00 – 4:00          Dept. No.                                                     Max. : 100 Marks



Section: A

Answer all questions:                                                                                         10 x 2 = 20


  • State the objectives of Cost Accounting.


2)  a) Imputed Cost is a ———- Cost.

  1. b) Operating Costing is suitable for ———— Industries.


  • What is a Cost Sheet?


  • From the following figures calculate Economic Order Quantity and the number of orders to be placed in each year.

Annual consumption of materials – 4,000 units.

Cost of buying per order – Rs.5

Cost per unit- Rs.2 per unit.

Storage and carrying cost – 8% on average inventory.


  • Find out the value of closing stock under LIFO:

Purchases of material on 1-2-04: 1000 units’ @Rs.12 per unit.

Purchases of material on 5-2-04: 1500 units @Rs.14 per unit

Issue on 15-2-04: 2100 units.


  • Calculate the total earnings from the following data under Halsey plan and under Halsey-weir plan. Standard Time: 10 hours; Time taken: 8 hours; Time rate: Rs.2.50 per hour.


  • What are the bases for apportionment of expenses given below to the different departments? 1) Depreciation, 2) Canteen expense, 3) Factory cleaning, 4) Crèche expenses, 5) Power.


8)  Write short note on a) Work Certified, b) retention money.


  • Answer the following questions in a sentence or two: A) How the normal loss treated in process costing? B) How is abnormal loss valued in process costing?


  • A transport service company is running four buses between two towns which are   Apart. Seating capacity of each bus is 50 passengers. Actual passengers carried were 80% of the seating capacity. All the four buses ran on all the days and of the month if April 2005. Each bus made one round trip per day. Calculate the total kilometers and total passenger kilometers for the month.


Section – B

Answer any five only:                                                                                    5 x 8 = 40


  • Distinguish between Financial accounting and Cost accounting.


  • Briefly explain various inventory control techniques.


  • What is Labour Turnover? Explain its causes and effect. And also suggest the steps to reduce labour turnover.


  • A) Compute machine hour rate from the information given below;

Cost of machine X Rs.13, 500.

Life of the machine – 10 years.

Estimated scrap value after 10 years Rs.1, 980.

Working hours 1800.

Insurance per annum Rs.45

Cotton wastes per annum Rs.75

Rent of dept. per annum Rs.975

Foreman’s salary per annum Rs.7500

Lighting for dept. per annum Rs.360

Repairs for entire life Rs.1440

Power: 10 units @ 7.5 paise per unit.

Machine X occupied 1/5 of the area and foreman devotes ¼ of his time to the machine. The machine has two light points out of the total 12 for lighting in the department.


  1. B) Distinguish between allocation and apportionment.


  • The following details are available from the books of accounts of accounts of a contractor for the year ended 31st March, 2004 with respect top particular contract No.113. He has undertaken for a manufacturing organization:


Materials sent to site                                                               5, 11,800

Labour engaged in site                                                            4, 66,100

Cost of plant installed at site                                                  1, 00,000

Direct expenses                                                                           24,000

Establishment expenses                                                              29,000

Materials returned to stores                                                          2,120

Work certified                                                                       10, 70,000

Cost of work not certified                                                          31,000

Materials in hand as on 31st March, 2004                                   12,220

Accrued wages as on 31st March, 2004                                      11,160

Accrued Direct expenses                                                              1,330

Value of plant as revealed on 31st March, 2004                         88,000


The contractor price agreed upon with the Contractee is Rs.13, 00,000 payment of Rs.9, 90,000 has been received from the Contractee. You are required to prepare the contract account, computing and incorporating the said account the profit to be taken to the profit and loss account for the year ended 31st March, 2004.



16) A product passes through three processes, A, B and C. The normal wastage if each process is as follows; Process A- 3%; B- 5%; C- 8%. The wastage of process A was sold at Rs.0.50 per unit, B at Re.1 per unit and C at Rs.2 per unit. 20,000 units were introduced in process A at a cost of Re.1 per unit. The other expenses are:

Process-A        Process-B        Process-C

Rs.                   Rs.                   Rs.

Sundry materials                     2,000               3,000               1,000

Labour                                   10,000             16,000             13,000

Direct expenses                       2,100               2,367               4,018

Actual output (units)             19,000             18,200             16,200


Prepare the process accounts, assuming that there were not opening or closing stocks. Also give the abnormal loss and abnormal gain account, normal loss account.


  • A) From the following information calculate: a) Economic order quantity, b) Reorder level, c) Maximum level, d) Minimum level.

Normal usage is 150 units per day. Minimum usage is 100 units per day. Maximum usage is 200 units per day. Reorder period 50 to 60 days. The annual usage is 50, 000 units. The cost of purchase is Rs.100 per order. Cost per unit is Re.1 carrying cost is 10%per annum.


  1. B) Draw a stores ledger card recording the following transaction under FIFO method.

2000 July.  1 Opening stock 2,000 units at Rs.10 each.

5 Received 1,000 units at Rs.11 each.

6 Issued 500 units

10 Received 5,000 units at Rs.12 each.

12 Received back 50 units out of the issue made on 6th July.

14 issued 600 units.

18 Returned to supplier 10o units out of goods received on 5th July.

19 Received back 100 units out of the issue made on 14th July.

20 Issued 150 units.

25 Received 500 units at RS.14 each.

28 Issued 300 units.

The stock verification report reveals that there was a shortage of 10 units on 18th July and another shortage of 15 units on 26th July.


  • A manufacturer of product X finds that in 2005 it cost him Rs.7,20,060 to manufacture 175 products of X, which he sold for Rs.5,400 each. The cost made up of:

Materials                     Rs.2, 82,000

Direct wages.               Rs.3, 24,000

Factory Overhead.       Rs.   48, 600

Office Overhead.         Rs.   65, 460

For the next year he estimates that:

  1. Each product will require materials of Rs.1, 600 and labour Rs.1, 800.
  2. The factory overhead will bear the same relation to wages as in the previous year.
  3. The office overhead percentage on factory cost will be the same as in the past. Prepare a statement showing the profit he would make per unit, if he reduces the price of the product by Rs.200.


Section – C

Answer any two only.                                                                                  2 x 20 = 40


  • Electronics Ltd., furnish the following information. It has three production departments A, B and C and two service departments D and E. The following figures are extracted from the records of the company:


Rent and Rates.          Rs.5, 000.        Power                                      Rs. 1, 500

General lighting          Rs.    600         Depreciation on Machinery     Rs.10, 000

Indirect wages             Rs. 1500         Sundries                                  Rs.10, 000


The following further details are available:

Particulars                   A              B              C                D              E

Floor Area (Sq.mts.)   2000         2500         3000          2000           500

Light points                     10             15             20              10               5

Direct wages (Rs)       3000         2000         3000           1500          500

H.P.of Machine               60             30             50               10          —-

Value of Machine.Rs.60000      80000     100000           5000        5000

Working hours             6226        4208         4066


The expenses of D and E are allocated as follows:


A         B         C         D         E

D                     20%     30%     40%     —          10%

E                      40%     20%     30%     10%     —


What is the total cost of an article if its raw material cost is Rs.50. Labour cost Rs.30, and it passes through departments A, B and C for 4, 5 and 3 hours respectively?


  • The following data are available is respect of Process I for a month.

Opening work in-progress:      900 units at Rs.4500

Degree of completion:                        Materials 100%, Labour 60%, Overhead 60%

Input of Materials:                  9100 units at Rs.27, 300

Direct wages:                          Rs.8, 200

Production overhead:              Rs.16, 400

Units Scrapped:                      1,200 units

Degree of completion:                        Materials 100%, Labour 70%, Overhead 70%

Closing work in progress:       1000 units

Degree of completion:                        Materials 100%, Labour 80%, Overhaead 80%

Units transferred to next

Process:                                   7, 800 units.

Normal process loss in 10% of total input (opening stock plus units put in); Scrap value is Rs.3 per unit.


  • Compute equivalent production
  • Compute cost per equivalent unit for each element and cost of abnormal loss or gain, closing WIP and units transferred to the next process; and
  • Prepare necessary accounts.


  • From the following particulars prepare:
    • A statement of cost of manufacture for the year 2005
    • A statement of profit as per cost accounts and
    • Profit and loss account in the financial books
    • Prepare also a reconciliation between cost and financial records


Opening stock of raw materials                            30, 000

Opening stock of finished goods                          60, 000

Purchase if raw materials                                   1, 80,000

Stock of raw materials at end                               45, 000

Stock of finished goods at end                             15, 000

Wages                                                                   75, 000


Calculate the factory expenses at 25% on prime cost and Office expenses at 75% on factory expenses.


Actual works expenses amounted to Rs.58, 125 and actual office expense amounted to Rs.45, 750. The selling price is fixed at a profit of 25% on cost.



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