Tuesday, May 21, 2019

Gauhati University Question Papers:Cost Accounting (Nov-Dec’ 2012)


2012
COST ACCOUNTING
Full Marks: 80
Time: 3 hours
(The figures in the margin indicate full marks for the questions)
1. Answer as directed:                                                                 1x10=10

1)         Which of the following is correct statement?
a)         Cost accounting is needed by a non-profit organisation such as a hospital.
b)         Cost Accounting provides information for ascertaining financial position of a company.
c)          All limited companies registered under the Companies Act, 1956 must maintain cost accounts records.
d)         Cost Accounting is not required if the price is beyond the control of the firm.
2)         Cost Accounting provides all of the following information except _______. [Fill in the gap from the following options:]
a)         Products costs.
b)         Cash forecasts.
c)          Inventory value.
d)         Cost of goods sold.
3)         Which of the following is correct statement?
a)         Cost Accounting helps in ascertaining accounting profit for income tax purpose.
b)         Cost Accounting provides information to all those who are internal and external to the firm.
c)          Costing and Cost Accounting are not the same term.
d)         Cost Accounting helps management in earning extra profit.
4)         Write the meaning of ‘Purchase requisition’.
5)         What is ‘Codification of Materials’?
6)         Just in time (JIT) approach is applied in which of the following cases?
a)         Material pricing.
b)         Inventory management.
c)          Cost Sheet preparation.
d)         EOQ.
7)         Which of the following statement is correct?
a)         Abnormal idle time wages are included in the cost of production.
b)         Total labour cost can be reduced by recruiting cheap labour.
c)          Fringe benefits are labour related costs.
d)         Premium bonus plans do not induce workers to increase efficiency.
8)         Define the term ‘Labour Turnover’.
9)         The time for which the employer plays, but from which he obtains no production, is called:
a)         Idle time.
b)         Abnormal idle time.
c)          Normal idle time.
d)         None of the above.
[Select the correct option]
10)      Give the definition of “Overhead absorption” as used in costing.
2. Answer the following very briefly:                                                5x2=10
1)         Write any two distinguishing features of cost unit and cost centre.
2)         Explain the meaning of Perpetual Inventory system.
3)         Mention the treatment of
a)         Research and development expenses and
b)         Interest on capital in Cost Accounting.
4)         Mention the justification for applying direct labour hour rate and machine hour rate for absorption of overheads.
5)         Mention the difference between overhead absorption and overhead apportionment.
3. Answer either (a) and (b) or (c):
(a) Calculate the gross wages received by Govinda from the following data for the week August 1 to 7:
Wages rate per hours
Units produced in week
Standard time allotted
Actual time taken
Rs. 4.00
300 units
60 hours
48 hours
Apply Rowan Premium Bonus Plan.                                                        5
(b) Explain the meaning of ‘Time and Motion Study’ stating its benefits to the management.  5
Or
(c) Write critical notes on:
1)         Work study and method study.
2)         Measurement of labour turnover and its effect.                           5x2=10
4. (a) Briefly describe the procedure of material purchase.                  5
Or
Briefly describe the stores function of a large factory.                             5
(b) A consignment of chemical X was received by Sharma Factory. The invoice reveals the following data:
Quantity
Rate per kg
Sales Tax (VAT)
Freight
4,000 kg
Rs. 2.50
Rs. 816
Rs. 384
After receiving the consignment it was noticed that there is a shortage of 200 kg. What stock rate would you adopt for the chemical assuming a provision of 5% towards further deterioration?      5
(c) Explain the treatment of under-absorption of overheads.                          5
Or
Explain briefly the factors to be kept in view while selecting a particular method suitable for overhead absorption.        5
(d) Briefly describe the procedure of calculating profit on incomplete contract.          5
Or
Mention the treatment of normal and abnormal losses in process costing.
5. (a) The following particulars have been obtained from the cost records of Shantaram Factory for the year 2011.

Rs.
Materials used:
In manufacturing
In primary packing
In selling the product
In the factory office
In the administrative office
Productive wages
Chargeable expenses
Factory supervision and expenses
Administrative expenses
Freight on material purchased
Depreciation on:
Factory building and machines
Office building
Delivery Van
Selling Expenses
Publicity
Bad debt

1,10,000
20,000
5,000
1,500
2,000
40,000
10,000
5,000
25,000
3,000

3,000
2,000
1,000
8,000
2,000
1,000
You are required to prepare a cost sheet assuming 1,000 units were manufactured and the selling price per unit is Rs. 300.00. Show also cost per unit.                      10
Or
“Costing techniques represent the principles or bases which govern the cost computations.” Explain the statement highlighting the application of these techniques in cost computation.
(b) The following are the summary of transactions obtained from the costing records of Nabaratna Company.

Rs.
Direct wages (cash)
Indirect wages (cash)
Purchases (cash)
Purchases (credit)
Stores issued against production order
Works expenses (cash)
Works expenses allocated to jobs
Administration expenses
Administration expenses allocated to jobs
Finished goods transferred to warehouse
50,000
30,000
20,000
3,00,000
2,80,000
50,000
80,000
40,000
48,000
4,50,000
You are required to Journalize the above transactions under integral accounting system.            10
Or
Briefly describe the need for procedure for integration of cost and financial accounts.          10
(c) A product passes through two processes: Process A and Process B.
Normal wastages are: 5% in Process A and 10% in Process B.
Scrap value:
(Per Unit)
Rs. 0.20 for Process A
Rs. 0.30 for Process B
Other details:

Process A
Rs.
Process B
Rs.
Materials
Direct wages
Manufacturing expenses
12,000
14,000
4,000
6,000
8,000
6,000
7,500 units of raw materials were introduced into Process A at a cost of Rs. 15,000. The outputs were: Process A: 7,000 units. Process B: 6,200 units.
You are required to prepare Process Accounts.                                         10
Or
From the information furnished below, prepare the Contract Account showing the cost and tender price.        10

Rs.
Direct material cost
Direct labour cost
Direct expenses
Works overhead
Office overhead
Profit margin
60,000
42,000
5,000
40% of direct wages
5% of works cost
20% of tender price


-000-

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