Dibrugarh University - Cost Accounting (May' 2013)

2013 (May)

Commerce (General/Speciality)

Course: 401

Full Marks: 80

Time: 3 Hours

1. (a) Choose the correct answer:
a)      Variable cost per unit remains same/increases/decreases due to increase in production.
b)      Under the ABC analysis of material control, A stands for low value/moderate value/high value items.
c)       Idle time represents the time for which the employers the time for which the employer makes payment and gains something in terms of production/makes payment but does not gain anything in terms of production.

(b) fill in the blanks:
a)      Fixed overhead cost is a Committed/Period cost.
b)      Prime cost incurred due to any abnormality is debited to Abnormal Loss Account.
c)       In process costing the output of the each process is the Input of the next process.

(c)  Write true or false:
a)      Most of the items of costs are direct in contract costing.  True
b)      High wages of cost not necessarily mean high cost per unit.  True

2. Answer the following:
b)      What do you mean by perpetual inventory system?
d)      Distinguish between ABC and VED analysis.

3. (a) Following extract of costing information relates to a commodity for the year ended 31st March, 2012:
Stock on 1st April, 2011: Raw materials
Finished product (1000 tones)
Stock on 31st March, 2012: Raw materials
Finished product (2000 tons)
Raw materials purchased
Direct wages
Rent, Rates and Taxes
Carriage inwards
Work in progress on 1st April, 2011
Work in progress on31st April, 2012
Cost of factory supervision
Sales of finished goods
Advertisement and selling expenses amounts of 0.25 paise per ton sold. 16000 tones were produced during the year. Prepare a statement showing:
a)      The value of raw material used;
b)      The cost of production;
c)       The cost of turnover for the year;
d)      The net profit for the year and net profit per ton.


4.   (a) From the following information, calculate the total monthly remuneration of each of three workers X, Y and Z:
Standard production per month per worker=1000 units
Actual production during a month X=890 units, Y= 720 units and Z= 960 units
Piecework rate per unit of actual production=20 paise
Dearness wages Rs. 50 per month (fixed)
House rent allowance 20 per month (fixed)
Additional production bonus at the rate of Rs. 5 for each percentage of actual production exceeding 80% of the standard.
(b) Discuss the principles of Premium Bonus Plans. Describe salient features of Rowan Plan and Halsey Plans  

5.  (a) Compute machine hour rate of a machine in a shop consisting of 3 machines occupying equal floor space. Following detail are supplied for the machine of which estimated working hours per year are fixed at 2500 hours in which normal idle time is estimated at 20% of the standard time:
Rent and taxes of the shop per annum
Electricity for the shop per month
Repairs and maintenance expenses for the machine per annum
Rate of power changes for 100 units(the machine consuming 10 units per hour)
Forman’s salary for supervising all three machines, per month
Indirect labour cost Rs. 2 per hour for the machine The machine cost Rs.130000 and scraps value is estimated at Rs. 10000 and estimated life is 10 years. The foreman devotes equal attention for each machine in the shop.   
(b) What do you mean by overhead cost? Explain the various classification of overhead cost and its bases of apportionment.

6. (a) A product process through processes A, B and C. The normal wastage of each process is as followings:
Process A=5%, Process B=6% and Process C=10%. Wastage of process A was sold at Rs. 2 per unit, that of process B at Rs. 5 per unit and that of process C at 10 per unit.
1000 units were issued to process A in the beginning of April, 2011 at a cost of Rs. 2 per unit. The other expenses were as follows:
A (Rs.)
B (Rs.)
C  (Rs.)
Raw materials
Direct expenses
Actual output(units)
Prepare processes accounts of A, B and C assuming that there were no opening or closing stocks.
(b) Explain the following:
a)      Value of WIP on an incomplete contract
c)       Difference between cost audit and financial audit.

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