Dibrugarh University - Cost Accounting 1999

Answer any five questions:-

1. ‘Cost Accounting is a branch of Accounting and has been developed due to limitations of Financial Accounting.’ Explain. 20

2. What is a cost sheet? What are the purposes of a cost sheet? Give the composition of a selling price. 5+5+10

3. What do you understand by ABC analysis and what is meant by Economic Order Quantity? Explain them with illustrations. 10+10
4. What do you mean by overheads? How are overheads classified? 5+15

5. The accounts of a machine manufacturing company disclose the following information for the six months ending 31st Dec, 97                                                                                                           Rs.
                Materials used                                                                  1, 50,000
                Direct wages                                                                      1, 20,000
                Factory overheads                                                             30,000
                Administrative expenses                                                 15,000
Prepare the cost sheet of the machines and calculate the price which the company should quote for the manufacture of a machine requiring materials valued Rs 1250 and expenditure in productive wages Rs 750 so that the price may yield a profit of 20% on the selling price. 10+10

6. From the following particulars, work out the earnings for the week of a worker under –
a)      Straight Piece Rate System;
b)      Differential Piece Rate System;
c)       Halsey Premium  System;
d)      Rowan System;                                  3+5+7+5

Number of working hours per week 48
Wages per hour Rs 3.75
Rate per piece Rs 1.50
Normal time per piece 20 minutes
Normal output per week 120 pieces
Actual output for the week 150 pieces
Differential Piece Rate:
80% of piece rate when output is below standard and 120% when above standard.

7. From the following figures, show the cost of the three processes of manufacture. The production of each process is passed on to the next till completion: 20
                                                                                Process A                                            Process B                                             Process C
                Wages and materials                      60,800                                                   24,000                                                   58,500
                Works Overheads                            11,200                                                   10,500                                                   12,000
                Production (in units)                       72,000                                                   75,000                                                   96,000
                Stock (units from 1st July, 89)          _                                                           8,000                                                   33,000
                Stock (units from 31st July, 89)        _                                                           2,000                                                   11,000

8. From the following particulars, calculate –                                       Standard Mix                     Rs
    a) Material Cost Variance;                                                        A             55 kg at Rs 2                        110
    b) Material Price Variance;                                                       B             45 kg at Rs 4                        180
    c) Material Total Usage Variance;                                                          100                                         290
    d) Material Mix Variance.                                                                                                                                                                         5+5+5+5
                                                                                                                                Actual Mix                           Rs
                                                                                                                A             60 kg at Rs 2.25                  135
                                                                                                                B             40 kg at Rs 3.50                  140
                                                                                                                                100                                         275