Dibrugarh University - Cost Accounting 1991

Answer any five questions:

1. What are the objectives of cost accountancy? Discuss in details its scope & limitations.  (6+7+7)

2. Describe in details the procedure of purchasing materials from outside. (20)

3. How would you identify the direct & indirect labour cost? Give four example of each of these   cost. Distinguish between the two. (8+4+8)

4. What do you mean by process costing? State its characteristics. Compare process costing with job costing. (5+7+8)

5. Write short notes on the following: -  (5x4)
a)      ABC analysis.
b)      Stares ledger.
c)      Normal wastage.
d)      Weighted average price.

6. A worker is working at Rs.5 per hour & he is entitled to a clearness allowance of Rs.56 per week of 48 hours. The time spent by him during the week is as follows: - (20)
                Job No.1                              34 hours
                Job No.2                              4 hours
Normal idle time              9 hours
                Abnormal idle time       6 hours
He is entitled to an incentive bonus under the rowan system; such bonus is being calculated on the basic wages only. Standard time allowed is 25 hours for job no.1 & 15 hours for job no.2. Calculate his earning for the week & show how the total amount of wages shall be treated for costing purpose.

 7. From the data given below, calculate the material price variance, material wage variance & material mixture variance: (20)
Consumption per 100 units of product:
Raw material                                      Standard                                                        Actual
A                                             40 units @ Rs50 per unit                                50 units @ Rs50 per unit
B                                             60 units @ Rs40 per unit                                60 units @ Rs45 per unit 

8. Calculate the machine hour rate in respect of a machine from the following information.    (20)

    Cost of the machine                                                                                                   Rs58000
    Estimated scrape value                                                                                             Rs3000
    Estimated working life                                                                                               20,000 hours
    Estimated cost of maintenance during working life of machine              Rs12000
    Cost of power used for the machine                                                                   Rs1 per hour
    Rent per month (10% to be charged for this machine)                                 Rs1500
    Normal machine running hours during a month                                             180 hours
    Standing charged other then rent per month                                                  Rs200