Maharshi Dayanand Saraswati University (MDSU) 2006 B.Com Cost Accounting : -II - Question Paper

Unit-III

5. (a) Sun Limited undertook a contract for Rs. 5,00,000 on first April, 2004.
On 31st March, 2005 when the accounts were closed, the subsequent
Details about the contract were gathered :
Rs.
Materials purchased 1,00,000
General Expenses 10,000
Materials on hand (31.03.2005) 25,000
Work certified 2,00,000
Cash received 1,50,000
Wages paid 45,000
Plant purchased 50,000
Wages accrued (31.03.2005) 5,000
Work uncertified 15,000
Depreciation 5,000

The above contract contained escalation clause which learn as follows :
“In the event of prices of materials and rates of wages increase by
more than 5% the contract price would be increased accordingly by
25% of the rise in the cost of materials and wages beyond 5% in every
case. “it was obtained that since the date of signing the agreement the
prices of materials and wages rates increased by 25%. The value of the
work certified does not take into account the effect of the above clause.

Prepare the contract account. Working should form part of the ans.
16
a company produces ‘A’ kind articles on which 5% of total weight in
process is lost and 10% is scrapped which is sold @ Rs. 80 per ton. The subsequent are the details of expenses :

materials 1,000 tonnes @ Rs. 125 per ton; Wages Rs. 18,000; Manufacturing expenses Rs. 6,000. obtain out the cost per ton of output.
4
6. (a) Write short notes on the subsequent :
evaluation of wastage
Reverse cost method
Provision for unrealized profit on stocks
Joint product and By-product 16
(b) name 4 industries where ‘Process Costing’ is applicable. 4

Unit-IV
7. (a) estimate the cash requirement of Apple Juice Company for June, 2005
on the basis of data provided beneath :

Sales Rs.
Feb, 2005 25,000
March, 2005 20,000
April to June 2005 30,0000 per month

Roughly half (1/2) the sales are for cash, 90% of credit sales are collected in the month subsequent the sales and the balance 1 month later.
Fruits are always bought for cash to avail of the cash discount of 5%. The purchase budget for the 2nd quarter (April-June) was 1,500 baskets per month at Rs. 10 perbasket.
Wages and salaries for the 2nd quarter were budgeted at Rs. 5,000 per month.
Manufacturing and other expenses budgeted for the quarter are:

Rs.
Cash expenses (manufacturing) 4,500
Depreciation 7,500
Selling expenses 3,000
Administration expenses 2,000
(In April and May only)
16
(b) in a basis foundry the ‘standard mix’ consists of 60 kg. Of copper and 40 kg. Of zinc. The standard loss of production is 30%. The standard price of copper is Rs. 50 per kg. And of zinc is Rs. 100 per kg. The true mix and yield were as follows :

copper 80 kg @ Rs. 45 per kg.
Zinc 70 kg @ Rs. 80 per kg.
Actual yield 115 kg. compute material mix and material yield variances. 4

8. (a) What is meant by the term ‘Variance Analysis’ ? define briefly the variances relating to material and labour. 16

(b) Define budgetary control. 4

Unit-V
9. (a) From the details provided below, compute :
P/V ratio.
Sales at break-even point.
Sales to earn a profit of Rs. 30,000 after tax, corporate tax rate being 50%.
Sales to provided a net income of 10% on sales.

Selling price Rs. 10 per unit
Variable works cost Rs. 5.50 per unit
Variable selling cost Rs. 1.50 per unit
Fixed works cost Rs. 2,70,000
Fixed selling cost Rs. 1,26,000
16
What is Break-even chart ? What purpose does it serve ?

10. (a) how does ‘Marginal Costing’ help the management in taking different
decisions ? discuss. 16

(b) A company has fixed expenses of Rs. 90,000 with sales at Rs. 3,00,000 and a profit of Rs. 60,000 compute margin of safety. 4

Earning:   Approval pending.