DISTANCE EDUCATION
B.B.A.(CS)/ B.B.A(CS) Lateral DEGREE EXAMINATION,
MAY 2016.
COST ACCOUNTING
Time Three hours Maximum 100 marks
PART A — 8 40 marks)
Answer any FIVE questions.
1. Explain the elements of cost.
2. What are the methods of absorption of manufacturing
overhead?
3. What is Reconciliation? Explain the methods of
Reconciliation.
4. Calculate maximum level, minimum level and reordering
level from the following data.
Re-order quantity 1,500 units
Re-order period 4 to 6 weeks
Maximum Consumption 400 units per week
Normal Consumption 300 units per week
Minimum Consumption 250 units per week
Sub. Code
34
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5. Mr. Gopal furnishes the following data relating to the
manufacture of a standard product during the month of
April 2012.
Raw materials consumed 15,000
Direct labour charges 9,000
Machine hours worked 900
Machine hour rate 5
Administrative overheads 20% in works cost
Selling overheads Re. 0.50 per units
Units produced 17,100
Units sold 16,000 at 4 per unit.
You are required to prepare a cost sheet from the above,
showing
The cost of production per unit
Profit per unit sold and profit for the period.
6. The firm employs five workers at an hourly rate of 2.00.
During the week, they worked for four days for a total
period of 40 hours each and complete a job for which the
standard time was 48 hours for each worker. Calculate
the labour cost under the Halsey method and Rowan
method of incentive plan payments.
7. What are the features of process costing?
8. From the following data, calculate material yield
variance.
Standard Mix Actual Mix
Material A 200 units 12 160 units 13
Material B 100 units 10 140 units 10
Standard loss allowed is 10% of output. Actual output is
275 units.
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PART B — 15 60 marks)
Answer any FOUR questions.
9. The standard price of a material is fixed at 10 per unit.
Prepare the stores Ledger Account showing how the cost
of materials issued and value of balance in stock will be
recorded under the standard price method from the
following purchases and issues made during June 2012.
Date Particulars Quantity Rate
June 2 Received 2000 units 11
June 5 Received 1000 units 10
June 10 Issued 1200 units
June 18 Received 800 units 9
June 25 Issued 900 units
June 29 Received 500 units 12
June 30 Issued 1,100 units
10. Calculate the earnings of worker A and B under straight
Piece-rate system and Taylor's Differential piece rate
system from the following particulars.
Normal rate per hour 1.80
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 1300 units per day and
Worker B produces 1500 units per day.
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11. A manufacturing company has four production
departments and six service departments. From the
following information briefly apportion the service
departments overheads to production departments only.
Production Departments Service Departments
P1 30,000 S1 (power) 18,000
P2 30,000 S2 (purchasing dept) 15,000
P3 24,000 S3 (stores dept) 12,000
S4(canteen) 9000
P4 16,000 S5 (Labor welfare) 6000
S6 (Time keeping) 4500
Additional Information:
P1 P2 P3 P4
Horse power of machine 600 600 300 300
Value of materials purchased
(Rs. in lakhs)
5 4 4 2
Number of stores requisitions 4 3 3 2
Number of workers 18 16 14 12
12. The profit and loss Account of oil India (Pvt)Ltd. for the
year ended 31st March 2012 is as follows:
To Materials 4,80,000 By Sales 9,60,000
To Wages 3,60,000 By Work -in
To Direct expenses 2,40,000 progress:
To Gross profit 1,20,000 Materials 30,000
Wages 18,000
Direct Exp. 12,000 60,000
By closing
stock 1,80,000
12,00,000 12,00,000
To Administration By Gross profit 1,20,000
expenses 60,000 By Dividends
66,000 received 6,000
1,26,000 1,26,000
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As per the cost records the direct expenses have been
estimated at a cost of 30 per kg and administration
expenses at Rs. 15 per kg. During the year production
was 6,000 kg and sales were 4,800 kg.
Prepare a statement of costing profit and loss account
and reconcile the costing profit with financial profit.
13. From the following particulars pass the journal entries in
an integrated accounting system.
Issued materials 3,00,000 of which
2,80,000(standard 2,40,000) direct material.
Net wages paid 70,000 deduction being 12,000
(standard 75,000)
Gross salaries payable for the period are
26,000(standard 25,000). Deduction 2,000
Sales (credit) 8,00,000
Discount allocation; 5,000.
Salaries and wages allocation; 60,000
direct(standard 62,000) and out of the balance
50% production, 30% Administration and 20%
selling and distribution overheads.
14. A product passes through three process B and C.
The normal loss of each process is as follows. process
process and Process loss of process A was
sold at 25% Paise per unit, that of B at 50 paise per unit
and that of C at Rs. 1.00 per unit. 10,000 units were
introduced to process A at Re.1.00 per unit. The other
expenses were as follows.
Process
A B C
Materials 2,050 2,688 2,509
Labour 5000 8000 6500
Actual output
(in units)
9500
9,100
8,100
Prepare the process accounts, assuming that there were
no opening or closing stocks.
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15. The standard cost of a chemical mixture is as under
8 tons of material A at 40 per ton
12 tons of material B at 60 per ton
Standard yield is 90% at input
Actual cost for a period is as under:
10 tons of material A at 30 per ton.
20 tons of material B at 68 per ton
Actual yield is 26. 5 tons.
Compute all material variances.