All
questions are of equal marks
1.
Outline the steps involved in installing a
costing system in a manufacturing unit. What are the essentials of an effective
costing system?
Or
Explain the term
“cost accounting”. How does it contribute to the planning of business
operations?
2.
“Store ledgers are essential to an efficient
costing system.” Give your views on this statement highlighting the uses and
values of stores ledgers.
Or
Your factory buys
and uses a component for production at Rs. 10 per piece. Annual requirement is
2000 number of pieces. Carrying cost of inventory is 10% per annum and ordering
cost is Rs. 40 per order. The purchase manager argues that as the ordering cost
is very high, it is advantageous to place a single order for the entire annual
requirement. He also says that if 2000 pieces are ordered at a time, 3%
discount can be obtained from the supplier. Evaluate the proposal and make your
recommendation.
3.
In a factory, Ram and Shyam produce the same
product using the same input of same material and at the same normal wage rate.
Bonus is paid to both of them in the form of normal time wage rate adjusted by
the proportion in which time saved bears to the standard time for the
completion of the products. The time allotted to the product is fifty hours.
Ram takes 30 hours and shyam takes 40 hours to produce the product. The factory
cost of the product for Ram is Rs. 3100 and for shyam is Rs. 3280. The factory
overhead rate is Rs. 12 per man hour. Calculate (i) normal wage rate, (ii) cost
of material used for the product and
(iii) the input material if the unit material cost is Rs. 16.
Or
Distinguish
between normal and abnormal idle time. How would you deal with each of them in
cost accounting?
4.
What do you mean by under absorption and over
absorption of production overhead? How do they arise? How are they arise? How
are they treated in cost accounts?
Or
What do you
understand by codification of overheads? What are the essential characteristics
of a good system of codification? Enumerate various methods of codification.
5.
Journalise the following transactions assuming
that cost and financial accounts are integrated. [ignore narrations]:
|
Raw material purchased
Direct materials issued to
production
Wages paid (30% indirect)
Wages charged to production
Manufacturing expenses incurred
Manufacturing overhead charged to
production
Selling and distributive cost
Finished product at cost
Sales
Receipts from customers
Paid to creditors
Closing stock
|
150000
112500
90000
75000
63000
69000
15000
150000
225000
52500
82500
Nil
|
Or
State the reasons
for the difference between the profits shown in the cost accounts and those
shown in the financial accounts of an industrial organisation. Explain the need
for reconciliation of cost and financial accounts.