Calculate Economic Ordering quantity: annual usage; 6000 units, Cost of Materials per unit Rs.20; Cost placing and receiving one order Rs.60; annual carrying cost Rs.2 per unit.

Ascertain the labour turnover under separation method;

Employees on 1-1-2003:14,000

Employees on 31-12-2003: 16,000

Employees who left during 2003: 750

What is meant by “Absorption of overheads”?

Fill in the blanks:

a) A cost is ———- if it does not change with change in activity level.
b) Power cost is apportioned on the basis of ———- hours.
c) ———- rate of absorption is suitable for labour oriented manufacturing.
d) Crèche expenses are apportioned on the basis of —————————-.

Write short note on equivalent production units.

What is escalation clause?

A transport service company is running four buses between two towns which are 50kms. Apart. Seating capacity of each bus is 40 passengers. Actual passengers carried were 75% 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

Explain the merits and demerits of perpetual inventory system.

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

What is Activity Based Costing? Differentiate it from the traditional costing system. Also state the advantages of ABC.

The following figures have been obtained from the cost records of Manufacturing Company for the year 2004:

Cost of Materials 2, 40, 000

Wages of labour 2, 00, 000

Factory Overheads 1, 20, 000

Distribution Expenses 56, 000

Administration Expenses 1, 34, 400

Selling Expenses 89. 600

Profit 1, 68, 000

A work order has been executed in 1993 and the following expenses have been incurred: cost of Materials Rs.32, 000 and Wages for Labour Rs.20, 000. Assuming that in 2005 the rate for factory overhead went up by 20%, distribution charges went down by 10% and selling and administration charges went up by 12 ½ %, at what price should the product or the job be quoted so as to earn the same (earlier) rate of profit on the selling price?. Show the full working. Distribution, Administration and Selling charges are based on the factory cost.

From the following particulars work out the earnings for the week of a worker under (A) Straight Piece- rate; (B) Taylor’s Differential piece rate; (C) Halsey Premium System; (D) Rowan System.

Number of working hours per week 48.

Wages per hour – Rs.3.75

Normal time per piece – 20 minutes.

Rate per piece – Rs.1.50

Normal output per week – 120 pieces

Actual output for the week – 150 pieces.

(A) 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 and Minimum 2 months. Reorder quantity 750 units.

(B) From the following particulars, prepare stores ledger by adopting Weighted Average Method of pricing of material issues:

Date Receipts Issues

01.01.90 300 units at Rs.10 per unit

10.01.90 200 units at Rs.12 per unit

12.01.90 400 units at Rs.11 per unit

15.01.90 250 units

16.01.90 150 units

18.01.90 200 units at Rs.14 per unit

20.01.90 300 units

22.01.90 300 units at Rs.15 per unit

25.01.90 100 units at Rs.16 per unit

27.01.90 200 units

31.01.90 100 units.

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.0.25 per unit, B at Rs.0.50 per unit and C at Re.1 per unit. 10,000 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 1,000 1,500 500

Labour 5,000 8,000 6,500

Direct expenses 1,050 1,188 2,009

Actual output (units) 9,500 9,100 8,100

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.

U construction Ltd. undertook a contract in 1992 for road construction. The contract price was Rs.10, 00,000 and its estimated cost of completion would be Rs.9, 20,000. At the end of 1992 the company received Rs.3, 60,000 representing 90% of work certified. Work not yet certified was Rs.10, 000. Expenditure incurred on the contract during 1992 was as follows:

Materials Rs.50, 000, Labour Rs.3, 00,000, Plant Rs.20, 000, Materials costing Rs.5, 000 were damaged and had to be disposed for Rs.1000. Plant to be depreciated by 25% Prepare contract account for 1992 in the books of U construction Ltd. also show the profit can be reasonable credited to profit and loss account in respect of the contract.

Section – C

Answer any two only. 2 x 20 = 40

The profit as per financial books for the year ended 31^st December,2005 is

Rs.2, 98,000. Following details are ascertained on comparison of cost and financial accounts:

Cost Accounts. Financial Accounts.

Rs. Rs.

Stock on 1-1-2005

Raw Materials 1, 00, 000 1, 20, 000

Work –in-progress 1, 30, 000 1, 40, 000

Finished Goods 90, 000 1, 00, 000

Stock on 31.12.2005

Raw Materials 86, 000 80, 000

Work –in-progress 74, 000 60, 000

Finished Goods 1, 24, 000 1. 18, 000

Direct expenses 60, 000

Purchases 8, 00, 000

Wages 4, 00, 000

Factory Expenses 4, 00, 000 4, 00, 000

Sales 22, 00, 000

Interest Received 32, 000

Office Expenses 46, 000 60, 000

Income Tax 15, 000

Loss on sale if investments 17, 000

Selling expenses 90, 000 80, 000

Prepare a cost sheet showing costing profit and also draw up a reconciliation statement as on 31.12.2005.

A factory has three production departments A, B and C and two service departments X and Y. the budgeted expenditure for the month of march 2002 are given below:

Rs.

Stores overhead 2, 500

Indirect wages 20, 000

Insurance 7, 000

Rent 10, 500

Power 14, 000

Lighting 5, 000

Depreciation 1, 05, 000

Other Overheads 40, 000

The other details are:

Particulars A B C X Y

Direct wages (Rs.) 75,000 40,000 60,000 10,000 15,000

Floor Area (sq.mtrs) 400 500 600 300 300

Value of Machine (Rs) 2,00,000 2,50,000 2,00,000 30,000 20,000

Horse Power 40 50 40 5 5

Direct materials (Rs.) 10,000 20,000 10,000 5,000 5,000

No. of light points 8 7 5 3 2

Service department overheads are apportioned on the following basis:

A B C X Y

Service Dept. X: 50 30 10 — 10

Service Dept. Y: 30 40 20 10 —

Assuming that overheads are recovered as percentage on direct wages, calculate the overhead recovery rates.

The following data are available in respect of process I for February,2000:

Opening stock of work in progress: 800 units at a cost of Rs.4000.

Degree of completion of opening work in progress:

Materials 100%

Labour 60%

Overheads 60%

Input of materials at a total cost of Rs.36,800 for 9200 units.

Direct wages incurred Rs.16,740

Production overhead Rs.8,370

Units scrapped 1,200 units. The stage of completion of these units was:

Materials 100%

Labour 80%

Overheads 80%

Closing work in progress 900 units. The stage of completion of these units was:

Materials 100%

Labour 70%

Overheads 70%

7,900 units were completed and transferred to the next process.

Normal loss is 8% of the total input (opening stock plus units put in)

Scrap value is Rs.4 per unit.

You are required to:

Compute equivalent production.
Calculate the cost per equivalent unit for each element.
Calculate the cost if abnormal loss or gain, closing work in progress and the units transferred to the next process using the FIFO method, and
Show the process account for February 2000.

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Loyola College B.Com Corporate & Secretaryship Nov 2008 Cost Accounting Question Paper PDF Download

October 23, 2017 by 01 prakash

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – CORPORATE SECRETARYSHIP

LA 06

FIFTH SEMESTER – November 2008

BC 5501 – COST ACCOUNTING

Date : 05-11-08 Dept. No. Max. : 100 Marks

Time : 9:00 – 12:00

SECTION – A

Answer ALL questions (10 x 2 = 20 marks)

What is perpetual inventory system?
Explain EOQ.
Give reasons as to why it is necessary to reconcile cost accounts and financial

accounts.

Explain with example ‘first-in- first-out’ (FIFO) method of stock valuation.
Differentiate between job costing and process costing.
How much of profit would you allow to be considered in the following case ?

Rs.

Cost incurred so far for contract : 2,80,000

Contract price : 5,00,000

Cash received : 2,70,000

Uncertified work : 30,000

Retention money 10%

Mr. X runs a tempo service and has 5 vehicles. Distance traveled by each vehicle per

day – 200 kms. Normal loading capacity – 100 quintals. Wastage in loading capacity

– 10%. Percentage of vehicle laid-up for repairs – 5%. Effective days in a month –

Calculate quintal kms of the vehicles.
Calculate direct labour hour rate from the following:

Total number of workers-100; Working days in a year-300; No. of hours per day

worked -8; Idle time -5%; Factory overheads-Rs. 11,400.

The records of Anand Company present the following data for the month of

August 2008. Direct labour cost-Rs.16,000(160% of factory overheads); cost

of production-Rs. 56,000; administration expenses-2,600; opening stock of raw

materials-Rs. 8,000 and closing stock of raw materials-Rs. 8,600; sales for the

month-Rs. 75,000. Prepare statement of cost.

Calculate earnings of Worker ‘A’ under straight piece system and Taylor’s

differential piece rate system. Normal rate per hour Rs. 2.40;standard time per

unit-30 seconds; Worker ’A’ produced 800 units per day.

SECTION – B

Answer any FIVE questions (5 x 8 = 40 marks)

What do you mean by elements of costs? Discuss the various elements of costs.
What is labour turn-over? Explain its causes and effects and also suggest the steps to

reduce labour turn-over.

Production sections of a factory working on the job order system pay their workers

under the Rowan Premium Bonus Scheme. Workers also get a Dearness allowance

of Rs. 12 per week of 55 hours.

A worker’s basic wage is Rs. 2 per day of 8 hours and his time sheet for a week is

summarised below:

Job No. Time allowed Time taken

1844 25 hrs 20 hrs

1926 30 hrs 20 hrs

Idle time(waiting) 8 hrs

48 hrs

Calculate the gross wages he has earned for the week and indicate the accounts

to which the wages amounts will be debited.

In a factory, there are two service departments S1 and S2 and three production

departments P1, P2, and P3. In April 1998, the departmental expenses were:

Departments P1 P2 P3 S1 S2

Rs. 6.50,000 6,00,000 5,00,000 1,20,000 1,00,000

The service department expenses are allotted on a percentage basis as follows:

Service Departments Production Deptts. Service Deptts.

P1 P2 P3 S1 S2

S1 30 40 15 — 15

S2 40 30 25 5 —

Prepare a statement showing the distribution of the two service departments

expenses to the three departments.

Utkal Construction Ltd. took a contract in 2007 for road construction. The contract

price was Rs. 10,00,000 and its estimated cost of completion would be Rs. 9,20,000.

at the end of 2007, the Company has received Rs. 3,60,000 representing 90% of

work certified. Work not yet certified had cost Rs. 10,000.

Expenditure incurred on the contract during 2007 was as follows: Materials

Rs. 50,000; Labour Rs. 3,00,000; Plant Rs. 20,000.

Materials costing Rs. 5,000 were damaged and had to be disposed of for Rs. 1,000

Plant is considered as having depreciated by 25%.

Prepare Contract Account for 2007 in the books of Utkal Construction Ltd.

16.Union Transport Company supplies the following details in respect of a truck of 5

tonne capacity:

Cost of truck Rs. 4,50,000

Estimated life 10 years

Diesel, oil, grease Rs. 150 per trip each way

Repairs & maintenance 5,000 per month

Drivers’ wages 5,000 per month

Cleaners’ wages 2,500 per month

Insurance 4,800 per year

Tax 2,400 per year

General supervision charges 4,800 per year

The truck carries goods to and from the city covering a distance of 50 km. each way.

In outward trip, freight is available to the extent of full capacity and on return 20%

of capacity. Assuming that the truck runs on an average of 25 days a month, work

out: (a) Operating cost per tonne-km (b) Rate per tonne per trip that the company

should charges if a profit of 50% on freight is to be earned.

17.Ace Ltd. manufactures a product and the following particulars are collected for

the year ended March, 2000.

—Monthly demand(units) 1,000

—Cost of placing an order(Rs.) 100

—Annual carrying cost(Rs. per unit) 15

—Normal usage(units per week) 50

—Minimum usage(units per week) 25

—Maximum usage(units per week) 75

—Re-order period(weeks) 4-6

Your are required to calcultate (i) Re-order quantity, (ii) Re-order level,

(iii) Minimum level, (iv) Maximum level, (v) Average stock level.

10,000 units of raw materials are introduced into a process at cost of Rs. 20,000. Wages

and overheads for the process are Rs. 5,100 and Rs. 3,400 respectively. 7,500 units

were completed; of the remaining 2,500 units on the average 40% work has been done

in respect of labour and overheads. Ascertain the cost of completed units and

work-in-progress at the end.

SECTION – C

Answer any TWO questions (2 x 20 = 40 marks)

South Viscose Ltd. has furnished you the following information from the financial

books for the year ended 31^st March 2008.

Profit and Loss Account

For the year ended 31^st March 2008

Opening Stock

500 units at Rs. 35 each

Materials consumed

Wages

Gross Profit c/d

Factory overheads

Administration overhead

Selling expenses

Bad debts

Preliminary expenses

Net Profit

Rs.

17,500

2,60,000

1,50,000

3,02,500

7,30,000

94,750

1,06,000

55,000

4,000

5,000

48,000

3,12,750

Sales:

10,250 units

Closing stock:

250 units @ Rs. 50 each

Gross Profit b/d

Interest

Rent Received

Rs.

7,17,500

12,500

________

7,30,000

3,02,500

250

10,000

________

3,12,750

The cost sheet shows the cost of materials as Rs. 26 per unit and the labour cost as

Rs. 15 per unit. The factory overheads are absorbed at 60% of labour cost and

administration overheads at 20% of factory cost. Selling expenses are charged at

Rs. 6 unit. The opening stock of finished goods is valued at Rs. 45 per unit.

You are required to prepare:

(i) a statement showing profit as per cost accounts for the year ended 31^st March

2008.

(ii) a statement showing the reconciliation of profit disclosed in cost accounts

with the profits shown in the financial accounts.

From the following details of stores receipts and issues of materials “EXE” in a

manufacturing unit, prepare the Stock Ledger using Weighted Average Method of

valuing the issues.

2005

Nov. 1 Opening stock 2,000 units @ Rs. 5.00 each

3 Issued 1,500 units to production

4 Received 4,500 units @ Rs. 6.00 each

8 Issued 1,600 units to production

9 Returned to stores 100 units by Production Department(from the issues

of Nov. 3)

16 Received 2,400 units @ 6.50 each

19 Returned to supplier 200 units out of the quantity receive on Nov. 4

20 Received 1,000 units @ Rs. 7.00 each

24 Issued to production 2,100 units

27 Received 1,200 units @ Rs. 7.50 each

29 Issued to production 2,800 units.

(Use rates upto two decimal places)

Product ‘Z’ is obtained after it passes three distinct processes. The following

information is obtained from the accounts for the month ending March, 2005:

Process

Items Total I II III

Rs. Rs. Rs. Rs.

Direct material 7,542 2,600 1,980 2,962

Direct wages 9,000 2,000 3,000 4,000

Production overheads 9,000 — — —

% of Normal Loss to input 5% 10% 15%

Output(in units) during the month 950 840 750

Value of scrap per unit(Rs.) 2 4 5

1,000 units at Rs. 3 each were introduced to process I. There was no stock of

material or work-in-progress at the beginning or end of the period. The output of

each process passess direct to the next process and finally to finished stores.

Production overhead is recovered on 100 per cent of direct wages.

Prepare process cost accounts and other related accounts.

Loyola College B.Com Corporate & Secretaryship April 2009 Cost Accounting Question Paper PDF Download

October 23, 2017 by 01 prakash

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

IR 13

B.Com. DEGREE EXAMINATION – CORPORATE SECRETARYSHIP

FIFTH SEMESTER – April 2009

BC 5501 – COST ACCOUNTING

Date & Time: 17/04/2009 / 9:00 – 12:00 Dept. No. Max. : 100 Marks

PART A

Answer ALL questions (10 x 2 = 20 marks)

ABC stock control.
Distinguish between ‘Fixed’ and ‘Variable’ cost.
Labour Turnover
Rowen plan
Machine Hour Rate
‘Joint products’ and ‘By products’
Economic batch quantity
From the following calculate Reorder Level and Minimum Level:

Usage 200 to 300 units per day; reorder period 8 to 10 days

Standard time allowed for a job is 20 hours. X completes the job in 15 hours. Rate per hour is Rs.10. Calculate his earnings under Rowan Plan.
Find out the economic ordering quantity (E.O.Q) from the following particulars.

Annual usage : 6,000 units

Cost of material per unit : Rs.20

Cost of placing and receiving one order : Rs.60

Carrying cost 10% per unit per annum

PART B

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

Distinguish between:
Bin card and Stores Ledger
Allocation, Apportionment and Absorption of overheads

Distinguish between ‘idle time’ and ‘overtime’. Explain their treatment in Cost Accounts.

From the following particulars, calculate the earnings of workers, A,B and C, under Taylors differential piece rate system:

Standard time per unit 6 minutes

Normal rate Rs.5 per hour

Differential piece rates:

80% of piece rate below the standard

120% of piece rate at or above the standard

In a day of 8 hours, A produced 70 units, B produced 80 units and C produced 100 units.

A purchased and issued materials in the following order:

March 1^st – purchased 300 units at Rs.3 per unit

5^th purchased 500 units at Rs.4 per unit

10^th issued 500 units

12^th purchased 700 units at Rs.4.50 per unit

15^th issued 700 units

20^th purchased 300 units at Rs.5 per unit

21^st issued 200 units

On 31^st a stock shortage of 20 units was noticed.

Prepare stores ledger under Weighted Average Method

From the following data prepare a reconciliation statement:

Rs.

Profit as per financial accounts 2,40,500

Works overhead over-recovered 9,500

Administrative overheads under-recovered 20,000

Selling overheads over-recovered 19,500

Under-valuation of opening stock in cost accounts 15,000

Overvaluation of closing stock in cost accounts 7,000

Dividend received during the year 5,750

Goodwill written off during the year 9,000

Notional interest charged in Cost Accounts 18,000

From the following data calculate the cost per km. of running a vehicle:

Value of vehicles Rs.25,000

Road licence fee per year Rs. 750

Supervisor’s salary per annum Rs. 1,800

Insurance charges per year Rs. 1,200

Garage rent per year Rs. 3,200

Driver’s wages per hour Rs. 4

Cost of petrol per litre Rs. 6.50

Km. per litre 6

Tyre allocation per km Re. 2.00

Repairs and maintenance per annum Rs.18,000

Estimated life 1,00,000 kms

Estimated annual kilometers 12,000

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

Factory uses job costing. The following cost data are available for the year ending 31^st December 2008:

Direct material Rs.9,00,000

Direct wages Rs.7,50,000

Factory overhead Rs.4,50,000

Administration overheads Rs.4,20,000

Selling overheads Rs.5,25,000

Sales Rs.36,54,000 Prepare: a) A cost sheet and ascertain the profit for the year.

b) In the year 2009 the company received an order for a job which would required direct material

Rs.12,000 and direct labor Rs.7,500. What price should the company charge for this job, if the

factory intends to earn the same rate of profit on sales as earned in 2007/2008, assuming selling

overheads have increased by 15%. The factory recovers, factory overheads as a percentage on

wages and administration and selling overheads as a percentage of works cost.

A by-product B is derived in the course of manufacture of product A. From the following data calculate the profit made on Product A:

The total expenses incurred upto the split off point is Rs.19,500. Separate expenses incurred for A and B are Rs.12,500 and Rs.3,100 resp. 100 kgs of A and 50 kgs of B were produced. B was sold at Rs.120 per kg on which the profit earned was 30%.

Selling price of Product A is Rs.400 per kg.

PART C

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

. 19. A company manufacturing two products A and B gives you the following data:

Product A B

Production in units 6000 4000

Raw material per unit (Rs.) 50 30

Labour cost per unit (Rs.) 20 10

Labour hours per unit 4 2

Number of set ups 10 20

Number of deliveries 24 14

The Overhead expenses were Rs.128,000 consisting of Set up costs Rs.90000; Delivery expenses Rs.38000.

Compute the production cost, per unit, of the two products A and B, if overheads are recovered using:

Rate per labor hour b)Activity based costing

From the following prepare a Contract Account and Contractee’s account for the three years 2007, 2008 and 2009:

2007(Rs.) 2008(Rs.) Rs.2009(Rs.)

Material issued 1,10,000 1,20,000 80,000

Wages 2,30,000 68,000 2,20,000

Machinery issued 50,000 – –

Value of machinery at the end 45,000 40,000 36,000

Materials returned to stores 1,000 500 –

Material at site 3,000 4,000 2,000

Work uncertified 2,000 6,000 –

Work certified 4,00,000 10,00,000 12,00,000

The contract price was for Rs.12,00,000. Cash received was 80% of the works certified.

A company produces a product which passes through three processes A, B and C. 1000 units are introduced at Rs.5 each in process 1. Other details are as follows:

A B C

Materials consumed (Rs.) 2,000 3,020 3,462

Direct wages 3,000 4,000 5,000

Direct expenses 500 226 –

Normal loss (%age on input) 10% 5% 10%

Sale value of normal loss per unit (Rs) 3 5 6

Output in units 940 870 810

Production overheads amounted to Rs.6,000, which is to be allocated to each process in the ratio of direct labor.

Prepare Process Accounts, Normal Loss account, Abnormal Gain account and Abnormal Loss account.

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Loyola College B.Com Corporate & Secretaryship Nov 2010 Cost Accounting Question Paper PDF Download

October 23, 2017 by 01 prakash

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – CORPORATE SEC.

FIFTH SEMESTER – NOVEMBER 2010

BC 5501/CR 5501 – COST ACCOUNTING

Date : 01-11-10 Dept. No. Max. : 100 Marks

Time : 9:00 – 12:00

SECTION – A

Answer ALL the questions: (10 x 2 = 20 marks)

Define Cost Accounting.
a) The method of costing used in a refinery is —————.
b) Cost Accounting records both monetary and ————– units.
Prepare a chart showing the different elements of cost.
From the following calculate the cost of goods sold: Cost of production `. 1,83,500;

Opening stock of finished goods `71,500; Closing stock of finished goods `.42,000.

A publishing house purchases 10,000units of a particular item per year at a unit cost

of ` 40. The ordering cost per order is Rs.100 and the inventory carrying cost is 25%

The worker completes a job in a certain number of hours. The standard time allowed

for the job is 8 hrs and the hourly rate of wages is` 10. The worker earns at the 50%

rate a bonus of ` 20 under Halsey plan. Ascertain his total wages under the Rowan

Premium Plan.

What do you mean by a ‘Machine Hour Rate’?
What is Idle time
Mention the bases of apportionment of the following expenses of departments:
a) Plant depreciation b) Lighting c) Power d) Consumable stores
Record the following transaction in stores ledger, price the issues at weighted average

rate: 200 units received at` 2.00 per unit on 2^nd September, 300 units received at

` 2.40 per unit during 15^th September and 250 units issued on 20^th September.

SECTION B ANSWER ANY FIVE (5 x 8 =40)

“While Financial Accounting is external, Cost Accounting is internal to the business”-

Explain this statement by bringing out the difference between Cost and Financial

Accounting.

Discuss the Secondary distribution of Overheads with illustrations.
Write short notes on a) Retention money b) Escalation clause c) Work in progress d) Target

costing.

A) Compute the (i) re-order level ; (ii) minimum level ; (iii) maximum level ; and (5)

(iv) average stock level for components A and B based on the following data:

Components

A B

Maximum consumption per week (in units) 250 200

Average consumption per week (in units) 150 100

Minimum consumption per week (in units) 100 50

Re-order period (in weeks) 6 to 10 5 to 9

Re-order quantity (in units) 500 700

B) Discuss the methods of pricing issue of materials. (3)

From the following figures prepare a Reconciliation Statement:

Net loss as per costing records 1,72,400

Works overhead under-recovered in costing 3,120

Administrative overhead recovered in excess 1,700

Depreciation charged in financial records 11,200

Depreciation recovered in costing 12,500

Interest received not included in costing 8,000

Obsolescence loss charged in financial records 5,700

Income-tax provided in financial books 40,300

Bank interest credited in financial books 750

Stores adjustments (credit) in financial books 475

Value of opening stock in : Cost Accounts 52,600

Financial Accounts 54,000

Value of closing stock in : Cost Accounts 52,000

Financial Accounts 49,600

Interest charged in cost accounts but not in financial accounts 6,000

Preliminary expenses written off in financial accounts 800

Provision for doubtful debts in financial accounts 150

Construction Ltd. Is engaged on two contracts A and B during the year.

The following particulars are obtained at the year end (Dec. 31) :

Contract A Contract B

Date of Commencement April 1 September 1

`. `.

Contract price 6,00,000 5,00,000

Materials issued 1,60,000 60,000

Materials returned 4,000 2,000

Materials at site (Dec. 31) 22,000 8,000

Direct Labour 1,50,000 42,000

Site Expenses 66,000 35,000

Establishment Expenses 25,000 7,000

Plant installed at site 80,000 70,000

Value of plant (Dec. 31) 65,000 64,000

Cost of contract not yet certified 23,000 10,000

Value of contract certified 4,20,000 1,35,000

Cash received from contractee 3,78,000 1,25,000

Architect’s Fees 2,000 1,000

During the period materials amounting to Rs. 9,000 have been transferred from contract A to contract B. you are required to show : (a) Contract accounts, (b) Contractees’ accounts, and (c) Extract from Balance Sheet as on December 31, clearly showing the calculation of work- in-progress.

A) From the following details of stores receipts and issues of material in a manufacturing

unit, prepare the Stock ledger using LIFO method. (5)

April 1 Opening Stock 2000 units @ ` 5.00 each

3 Issued 1,500 units to production

4 Received 4,500 units @ ` 6.00 each

8 Issued 1,600 units to production

Returned to stores 100 units by production department (from the issue of April 3)

16 Received 2,400 units @ ` 6.50 each

19 Returned to supplier 200 units out of the quantity received on April 4^th.

20 Received 1,000 units @ ` 7.00 each

24 Issued to production 2,100 units

27 Received 1,200 units @ ` 7.50 each

29 Issued to production 2,800 units

B) Discuss the relative merits and demerits of two of the main methods of remunerating

labour. (3)

Jaidka owns fleet of taxi and the following information is available from the records

maintained by him :

Number of taxis 10

Cost of each taxi `20,000

Salary of manager `600 p.m.

Salary of accountant ` 500 p.m.

Salary of cleaner `. 200 p.m.

Salary of mechanic `400 p.m.

Garage rent ` 600 p.m.

Insurance premium 5% per annum

Annual tax `600 per taxi

Driver’s salary `200 p.m. per taxi

Annual repair `1,000 per taxi

Total life of a taxi is about 2,00,00 kms. A taxi runs in all 3,000 kms. in a month of which 30% it runs empty. Petrol consumption is 1 litre for 10 kms. @ `1.80 per litre. Oil and other sundries are ` 5.00 per 100 kms.

Calculate the cost of running a taxi per km.

SECTION-C

ANSWER ANY TWO ( 2 x 20 = 40 marks)

Modern Manufacture Ltd., have three production departments P₁, P₂, P₃ and two Service

Departments S₁ and S₂, the details pertaining to which are as under :

P₁ P₂ P₃ S₁ S₂

Direct wages (`) 3,000 2,000 3,000 1,500 195

Working Hours 3,070 4,475 2,419 – –

Value of Machines (`) 60,000 80,000 1,00,000 5,000 5,000

H.P. of Machines 60 30 50 10 –

Light points 10 15 20 10 5

Floor Space (sq. ft.) 2,000 2,500 3,000 2,000 500

The following figure extracted from the accounting records are relevant :

Rent and Rates `5,000, General Lighting `600, Indirect Wages `1,939 ; Power `1,500 ; Depreciation on Machines `10,000 and Sundries ` 9,695.

The expenses of the Services Departments are allocated as under :

P₁P₂ P₃S₁S₂

S₁20% 30% 40% – 10%

S₂ 40% 20% 30% 10% –

Find out the total cost of product ‘X’ which is processed for manufacture in Department P₁, P₂ and P₃for 4,5 and 3 hours respectively, given that its Direct Material Cost is `50 and Direct Labour Cost ` 30.

20) Product B passes through three processes before it is transferred to finished stock. The following information is obtained for the month of March :

Details Process `Finished Stock

I II III

` ` ` `

Opening Stock 5,000 8,000 10,000 20,000

Direct Material 40,000 12,000 15,000 –

Direct Wages 35,000 40,000 35,000 –

Production Overheads 20,000 24,000 20,000 –

Closing Stock 10,000 4,000 15,000 30,000

Profit % on Transfer price 25% 20% 10% –

(to next process)

Inter-process Profit for

Opening Stock – 1,395 2,690 6,534

Stock in process accounts are valued at Prime cost and finished stock has been valued at the price at which it is received from Process III. Sales during the period were Rs. 4,00,000.

Prepare and compute :

Process cost accounts showing profit element at each stage ;
Actual realized profit ; and
Stock valuation for Balance Sheet purpose.

21) Following information has been obtained from the records of a Manufacturing Company :

1-1-2001 31-12-2001

` `

Stock of raw materials 40,000 50,000

Stock of finished goods 100,000 1,50,000

Stock of work- in-progress 10,000 14,000

Indirect Labour 50,000

Lubricants 10,000

Insurance on Plant 3,000

Purchase of Raw Materials 4,00,000

Sales Commission 60,000

Salaries of Salesmen 100,000

Carriage Outward 20,000

Administrative Expenses 1,00,000

Power 30,000

Direct Labour 3,00,000

Depreciation on Machinery 50,000

Factory Rent 60,000

Property Tax on Factory Building 11,000

Sales 12,00,000

Prepare a Statement of Cost and Profit showing

Cost of Production ;
Cost of Goods Sold ;
Cost of Sales ; And
Profit

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Loyola College B.Com Corporate & Secretaryship April 2011 Cost Accounting Question Paper PDF Download

October 23, 2017 by 01 prakash

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – CORPORATE SEC.

FIFTH SEMESTER – APRIL 2011

BC 5501 – COST ACCOUNTING

Date : 18-04-2011 Dept. No. Max. : 100 Marks

Time : 9:00 – 12:00

PART A

Answer ALL questions 10×2=20 marks

Explain the following terms: Q.nos.1-4

Opportunity cost

Idle time

Overtime wage

Retention money

State whether the following statements are TRUE or FALSE:
The cost of normal loss units are borne by the good units produced.
The cost unit for a goods transport service is cost per passenger kilometre.

Stock on 1^st January 500 units at Rs.10 per unit.

Purchases on 1^st January 14500 units at Rs.12 per unit.

On 31^st January the stock was 2000 units.

Compute the value of the stock on that date, if materials are priced under ‘Weighted average’ method.

Annual requirement is 1600 units. Cost per unit Rs.40. Ordering cost per unit is Rs.50; carrying cost 10% of inventory value. Calculate Economic Order quantity.

Time allowed for a job is 48 hours. Time taken by worker X is 40 hours. Time rate is Rs.5 per hour. Calculate the earnings of X under Halsey plan and Rowen plan.

Estimated machine hours per year 2000; estimated factory overheads per year Rs.10000; job 77 requires Rs.500 direct material and Rs.300 direct wages. It takes 10 machine hours to complete the job. Compute the factory cost of job 77.

500 units are introduced in process I, 300 units are completed and transferred to process II, 200 units 80% complete are in work-in-progress. If the total expenses of the process is Rs.23000, calculate the value of closing work-in-progress.

PART B

Answer ANY FIVE questions 5×8=40 marks

Discuss the advantages of Cost Accounting.

Define ‘labour turnover’. What are the causes for labour turnover? Explain any two methods for computing labour turnover.

A machine is purchased for cash at Rs.9,200. Its working life is estimated to be 18,000 hours after which its scrap value is estimated at Rs.200. it is assumed from past experience that:
The machine will work for 1,800 hours annually.
The repair charges will be Rs.1,080 during the whole period of life of the machine.

The power consumption will be 5 units per hour at 6 paise per unit.

Other annual standing charges are estimated to be:
Rent of department (machine 1/5^th) 780
Light (12 points in the dept – 2 points engaged in the machine) 288
Foreman’s salary (1/4^th of his time is occupied in the machine) 6000
Insurance premium (fire) for machinery 36
Cotton waste 60

Find out the machine hour rate on the basis of above data for allocation of the works expenses to all jobs for which the machine is used.

A transport service company is running 4 buses between two towns which are 50 kms apart. Seating capacity of each bus is 40 passengers. The following particulars are obtained from the records for the month of April 2010:

Rs.

Wages of drivers, conductors and cleaners 24,000

Salaries of office and supervisory staff 10,000

Repairs and maintenance 8,000

Taxes, insurance, etc. 16,000

Depreciation 26,000

Interest and other charges 20,000

The seating capacity utilised was 75%. All the four buses ran on all days of the months. Each bus had made one round trip daily. The bus consumes 1 litre diesel per 20 kms. The cost of diesel is Rs.10 per litre.

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

Modern Constructions Ltd. has taken a contract on October 1, 2009. The position of the contract on September 30, 2010 is as follows:

Rs.

Contract price 27,00,000

Materials 5,80,000

Wages paid 9,64,000

Other expenses 24,000

Plant at site 1,60,000

Unused materials at site 40,000

Wages payable 36,000

Other expenses due 4,000

Cash received being 75% of works certified 12,00,000

Work completed but not yet certified 80,000

The plant at site is to be depreciated at 10%.

Material costing Rs.40000 was returned to stores.

Material costing Rs.10000 was stolen from the site.

Prepare the contracts accounts, showing the notional profit and also profit to be transferred to Profit and Loss account.

From the following information, prepare a cost sheet for the month of December 2010:

Rs.

Stock on hand – 1^st December 2010:

Raw materials 25,000

Finished goods 17,300

Stock on hand – 31^st December 2010:

Raw materials 26,200

Finished goods 15,700

Purchases of raw materials 21,900

Carriage on purchases 1,100

Work-in-progress, 1/12/2010 at works cost 8,200

Work-in-progress, 31/12/2010 at works cost 9,100

Sale of finished goods 72,300

Direct wages 17,200

Non-productive wages 800

Direct expenses 1,200

Factory overheads 8,300

Administration overheads 3,200

Selling and distribution overheads 4,200

Calculate the earnings of a worker under i) Halsey Plan (ii) Rowan plan and (iii) Piece rate system from the following particulars:
Hourly rate of wages guaranteed Rs.6 per hour
Standard time for producing one dozen articles – 3 hours
Actual time taken by the worker to produce 20 dozen articles – 48 hours.

From the following data prepare a reconciliation statement:

Rs.

Profit as per cost account 1,45,500

Works overheads under-recovered 9,500

Administrative overheads under-recovered 22,750

Selling overheads over-recovered 19,500

Over valuation of opening stock in cost accounts 15,000

Over valuation of closing stock in cost accounts 7,500

Interest earned during the year 3,750

Rent received during the year 27,000

Bad debts written off during the year 9,000

Preliminary expenses written off during the year 18,000

PART C

Answer ANY TWO questions 2×20=40 marks

The following information is provided by S.M.Ltd for the fortnight of April 2010:

Material exe:

Stock on 1.4.2010 100 units at Rs.5 per unit

Purchases :

5.4.2010 300 units at Rs.6

8.4.2010 500 units at Rs.7

12.4.2010 600 units at Rs.8

Issues:

6.4.2010 250 units

10.4.2010 400 units

14.4.2010 500 units

On 11/4/2010 100 units were returned to supplier and on 15/4/2010 stock verifier found a shortage of 20 units.

Using FIFO and LIFO methods of pricing issues, prepare the Stores Ledger.

20,000 units were introduced in Process A, at a cost of Rs.40,000. After processing 18,500 units were transferred to Process B, which produced final output of 18,000 units. Other particulars are given below:

Process A Process B

Material cost Rs.40,000 Rs. 4,000

Labour cost Rs.12,000 Rs.10,000

Overheads Rs. 8,000 Rs. 9,553

Normal loss % on input 5 4

Sales value of scrap units Re.1 Rs.2

There was no opening or closing work-in-process.

Prepare Process accounts, Normal loss account, Abnormal loss account and Abnormal gain account.

A company has 3 production departments A, B and C and two service departments X and Y. The following data are extracted from the records of the company for a particular given period:

Rs.

Rent and rates 25,000

Power 7,500

General lighting 3,000

Depreciation on machinery 50,000

Indirect wages 7,500

Sundries 50,000

Additional data, department-wise:

Total Dept.A Dept.B Dept.C Dept.X Dept.Y

Direct wages (Rs) 50000 15000 10000 15000 7500 2500

HP of machines used 150 60 30 50 10 –

Cost of machinery (Rs) 1250000 300000 400000 500000 25000 25000

Production hours worked – 6226 4028 4066 – –

Floor space used (sq mt) 10000 2000 2500 3000 2000 500

Lighting points (nos) 60 10 15 20 10 5

Service department’s expenses allocation:

A B C X Y

X 20% 30% 40% – 10%

Y 40% 20% 30% 10% –

You are required to:

Compute the overhead rate of production departments using the repeated distribution method; and
Hence, determine the total cost of a product whose direct material cost and direct labour cost are respectively Rs.250 and Rs.150 and which would consume 4 hours, 5 hours and 3 hours in departments A, B and C respectively.

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Loyola College B.Com Corporate & Secretaryship April 2012 Cost Accounting Question Paper PDF Download

October 23, 2017 by 01 prakash

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – CORPORATE SEC.

FIFTH SEMESTER – APRIL 2012

BC 5501 – COST ACCOUNTING

Date : 27-04-2012 Dept. No. Max. : 100 Marks

Time : 9:00 – 12:00

SECTION – A

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

Define cost accounting.
Prime cost includes direct material, direct——-and direct——–.
Say true or false with reason

ABC analysis gives equal importance to all materials

The time card of a worker reveals that in a normal week of 48 hours, he worked for 52 hours at the rate of Rs.15 per hour. Taking over time premium at 100% of the time rate calculate the gross wages
Find out the amount of rent apportioned to each department.

Rent-Rs.8000

Space occupied by departments:

A-100 sq.feet

B-200 sq.feet

C-300 sq.feet

D-400 sq.feet

6) Write a note on job costing and the industries which adopt job costing.

7) What is work certified?

8) Cost of tyres and tubes is a——-charge in operating costing.

9) Pankajam travels employs 5 buses which run over a route of 140 kms(one way),

making one round trip a day. The buses run 360 day per year and 10% of them on

average are laid out for repairs. Ascertain the total running kilometers per year.

10) What are joint products?

SECTION – B

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

11) Discuss the objectives and functions of cost accounting.

12) Explain ABC method of inventory control.

13) What are the causes for labour turn over?

14) The following details have been extracted from the cost records of Rajasekhar Ltd.

Particulars	Rupees
Stock of raw materials on 1^st December 2010	75,000
Stock of raw materials on 31^st December 2010	91,500
Direct wages	52,500
Indirect wages	2,750
Sales	2,11,000
Work-in-progress 1^st December 2010	28,000
Work-in-progress 31^st December 2010	35,000
Purchase of raw materials	66,000
Factory rent, rates and power	15,000
Depreciation of plant and machinery	3,500
Expenses on purchases	1,500
Carriage out wards	2,500
Advertising	3,500
Office rent and taxes	2,500
Traveling salesmen wages and commission	6,500
Stock of finished goods 1^st December 2010	54,000
Stock of finished goods 31^st December 2010	31,000

Prepare a cost sheet with maximum possible information.

15) From the following information calculate:

i) Economic order quantity
ii) Reorder level

iii) Maximum level

iv) minimum level

Normal usage 150 units per day. Minimum usage 100 units per day. Maximum usage 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 Rs.1. Carrying cost is 10% per annum.

16) From the following particulars, calculate earnings of a worker under:

i) Time rate system
ii) Piece wage rate

iii) Halsey plan

iv) Rowan plan

Wage rate-Rs.2 per hour

Production per hour-4 units

Dearness allowance-Rs.1 per hour

Standard time fixed-80 hours

Actual time taken-50 hours

Production-250 units

17) From the following information of Swetha Construction Company prepare the contract account for

Also show what part of the profit on the contract should be taken credit of in 2009. The contract

was for Rs.8, 00,000.

Particulars	Rupees
Materials issued from stores	1,50,000
Wages paid	2,20,000
General charges	8,000
Plant installed at site on 1^st july 2009	40,000
Materials on hand at close	8,000
Wages accrued due	8,000
Work certified	4,00,000
Work completed but not certified	12,000
Cash received	3,00,000
Materials transferred to other contracts	8,000
Depreciation on plant is to provided at 10% per annum	2,000

18) In manufacturing the main product A, a company processes the resulting waste material into two by-

products-B and C. During one period of production the following data was compiled

Particulars	A	B	C
Sales	8,00,000	64,000	96,000
Cost before separation (Rs)	3,10,400	—	—
Cost after separation (Rs)	80,000	12,800	14,400
Estimated net profit percentage to sales value	—	20%	30%
Estimated selling expenses as percentage of sales value	20%	10%	15%

There is no beginning or ending inventories. Prepare an income statement concerning the period described using reversal cost method for by-products.

SECTION – C

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

19) The following information is available in respect of process I for the month of January 2011

Opening work in progress-5000units

Materials 100% complete-Rs.18,750

Labour 60% complete-Rs.7,500

Overheads 60% complete-Rs.3,750

Units introduced into the process-20,000

Closing work-in-progress-7,000 units

Materials 100% complete

Labour 50% complete

Overheads 50% complete

18,000 units are transferred to next process. The process costs for the month were as follows:

Materials-Rs.2, 31,250;Labour-Rs.1,64,500 and Overheads-Rs.82,250.

Prepare statement of equivalent production, statement of cost, statement of evaluation and process

account by following average cost method

20) Modern Manufacturers Ltd have three production departments A,B,C and two service departments S1

and S2, the details pertaining to which are as under

Particulars	A	B	C	S1	S2
Direct wages (Rs)	30,000	20,000	30,000	15,000	5,000
Working hours	3,070	4,475	2,419	—	—
Value of machines(Rs)	6,00,000	8,00,000	10,00,000	50,000	50,000
H.P of machines	60	30	50	10	—
Light points	100	150	200	100	50
Floor space (Sq.feet)	20,000	25,000	30,000	20,000	5,000

The following figures extracted from the accounting records are relevant.

Rent-Rs.15,000; General lighting-Rs.6,600;Indirect wages-20,000;Power-Rs.15,000;Depreciation on machines-Rs.1,00,000 and sundries-Rs.10,000

The expenses of service departments are allocated as under:

Departments	A	B	C	S1	S2
S1	20%	30%	40%	—	10%
S2	40%	20%	30%	10%	—

Find out the works cost of product X which is processed for manufacture in departments A,B,C for

4,5,3 hours respectively, given that its direct material is Rs.500 and direct labour cost is Rs.430.

21) A person owns a bus which runs from Delhi to Chandigargh and back for 10 days in a month. The

distance between Delhi and Chandigarh is 150 miles. The trip between these places is completed the

same day. The bus goes another 10 days to Agra which is 120 miles away from Delhi and completed

on the same day. For the rest of the 4 days in a month the bus makes local trips distance covered in

this being 40 miles. Calculate the rate the person should charge a passenger when he wants to earn a

profit of 33 1/3 % on his takings. The other information is given below:

Cost of the bus	Rs 60,000	Lubricant oil Rs 10 per 100 miles
Depreciation	20%	Repairs and maintanance	Rs 500 pm
Salary of Driver	Rs 350 pm	Permit fees	Rs 284 pm
Salary of Conductor	Rs 350 pm	Normal capacity of the bus	50 passengers
Salary of accountant	Rs 160 pm	Token tax	Rs 600 p.a
Insurance	Rs 1680 p.a	Diesel Consumption 4 miles per litre costing Rs 1 per litre.

The bus is generally occupied 90% of the capacity when it goes to Chandigharh and 80% when it goes to Agra and is full in local trips. Passenger tax 20% of his net takings.

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