Cost and Management Accounting 103' 2023 [DODLDU MCOM 1st SEM Question Paper]

Cost and Management Accounting 103 DODLDU MCOM 1st SEM Question Paper
2023 (COMMERCE)
Paper: COM-103 Cost and Management Accounting)

Full Marks: 80

Time: Three hours

The figures in the margin indicate full marks for the questions.

1. (a) What is Activity Based Costing? What benefits does ABC provide? What are the differences between Activity Based Costing and conventional costing?            4+6+6=16

Or

(b) Define Cost Accounting? Explain the importance of Cost Accounting as a managerial tool.        4+12=16

2. (a) What is Process Costing? What are the main features of Process Costing? Compare and contrast Process Costing with Job Costing.              4+6+6=16

Or

(b) Modern Company Ltd. made a profit of Rs. 20,000 during the year 2023 as per their costing system, whereas their final accounts disclose a profit of Rs. 15,000. From the following Profit and Loss Account summarised by the company for the year ended on 31^st March, 2023 as per the financial books, you are required to prepare a Reconciliation Statement showing the causes for this difference:                             16

Particulars	Amt.	Particulars	Amt
To opening Stock of finished goods To Purchases To direct wages To factory expenses To gross Profit	1,00,000 80,000 20,000 15,000 40,000	By Sales By closing stock finished goods	1,75,000 80,000
	2,55,000		2,55,000
To administrative expenses To selling expenses To net profit	10,000 15,000 15,000	By gross profit	40,000
	40,000		40,000

Costing records show the following:

(1) Stock ledger closing balance Rs. 89,000;

(2) Direct labour Rs. 23,000;

(3) Factory overheads Rs. 13,000;

(4) Administrative overheads and selling expenses each are calculated at 8% of sales separately.

3. (a) “Analysis of Financial Statements is the best way to judge the overall financial health of a company.” Explain the statement with your justification.             16

Or

(b) From the following information of X Ltd. for the year ended on 31^st March, 2022 and 31^st March, 2023, prepare a Comparative Income Statement and comment on it:

	31st March 2022	31st March 2023
Sales (net) Gross profit Operating Expenses: General and Administrative Expenses Non-operating Expenses: Interest paid Income Tax Rate Non-operating / other incomes	Rs. 2,00,000 Rs. 1,20,000   Rs. 40,000   Rs. 30,000 50% Rs. 10,000	Rs. 2,40,000 Rs. 1,38,000   Rs. 50,000   Rs. 30,000 50% Rs. 12,000

4. (a) Discuss the significance of the following ratios:       4x4=16

(1) Liquidity ratio.

(2) Profitability ratio.

(3) Activity ratio.

(4) Leverage ratio.

Or

(b) Following is the Income Statement of Arvind and Co. for the year ended on 31^st March, 2023:                16

Particulars	Amt.
Revenue from operations (sales) Add: Other Income Interest on Investment Profit on fixed assets	15,000 10,000	5,30,000     25,000
Total Revenue Less: Expenses Purchases Change in inventories (Opening stock – Closing stock) (Rs. 1,00,000 – Rs. 1,20,000) Wages Administrative Expenses Selling and Distribution Expenses Non-Operating Expenses	3,40,000     (20,000) 5,000 30,000 90,000 20,000	5,55,000                 4,65,000
Net Profit		90,000

You are required to calculate:

(a) Gross profit ratio.

(b) Net profit ratio.

(c) Operating ratio.

(d) Operating profit ratio.

5. (a) Define the term working capital. What factors would you take into consideration in estimating the working capital needs of a concern?         4+12=16

Or

(b) From the following information you are required to estimate the net working capital:  16

	Cost per unit (Rs.)
Raw materials Direct labour Overheads (excluding depreciation)	400 150 300
Total cost	850

Additional information:

Selling price Output Raw materials in stock Work-in-process: (Assume 50% completion stage with full material consumption) Finished goods in stock Credit allowed to debtors Credit allowed by suppliers Cash at bank is expected to be

Rs. 1,000 per unit 52,000 units per annum Average 4 weeks   Average 2 weeks Average 4 weeks Average 8 weeks Average 4 weeks Rs. 50,000

Assume that production is sustained during the 52 weeks of the year. All sales are on credit basis. State any other assumption that you might have made while computing.

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