# Cost and Management Accounting 103' 2023 [DODLDU MCOM 1st SEM Question Paper]

## Cost and Management Accounting 103 DODLDU MCOM 1st SEM Question Paper2023 (COMMERCE)Paper: COM-103 Cost and Management Accounting)

Full Marks: 80

Time: Three hours

The figures in the margin indicate full marks for the questions.

1. (a) What is Activity Based Costing? What benefits does ABC provide? What are the differences between Activity Based Costing and conventional costing?            4+6+6=16

Or

(b) Define Cost Accounting? Explain the importance of Cost Accounting as a managerial tool.        4+12=16

2. (a) What is Process Costing? What are the main features of Process Costing? Compare and contrast Process Costing with Job Costing.              4+6+6=16

Or

(b) Modern Company Ltd. made a profit of Rs. 20,000 during the year 2023 as per their costing system, whereas their final accounts disclose a profit of Rs. 15,000. From the following Profit and Loss Account summarised by the company for the year ended on 31st March, 2023 as per the financial books, you are required to prepare a Reconciliation Statement showing the causes for this difference:                             16

 Particulars Amt. Particulars Amt To opening Stock of finished goods To Purchases To direct wages To factory expenses To gross Profit 1,00,000 80,000 20,000 15,000 40,000 By Sales By closing stock finished goods 1,75,000 80,000 2,55,000 2,55,000 To administrative expenses To selling expenses To net profit 10,000 15,000 15,000 By gross profit 40,000 40,000 40,000

Costing records show the following:

(1) Stock ledger closing balance Rs. 89,000;

(2) Direct labour Rs. 23,000;

(4) Administrative overheads and selling expenses each are calculated at 8% of sales separately.

3. (a) “Analysis of Financial Statements is the best way to judge the overall financial health of a company.” Explain the statement with your justification.             16

Or

(b) From the following information of X Ltd. for the year ended on 31st March, 2022 and 31st March, 2023, prepare a Comparative Income Statement and comment on it:

 31st March 2022 31st March 2023 Sales (net) Gross profit Operating Expenses: General and Administrative Expenses Non-operating Expenses: Interest paid Income Tax Rate Non-operating / other incomes Rs. 2,00,000 Rs. 1,20,000   Rs. 40,000   Rs. 30,000 50% Rs. 10,000 Rs. 2,40,000 Rs. 1,38,000   Rs. 50,000   Rs. 30,000 50% Rs. 12,000

4. (a) Discuss the significance of the following ratios:       4x4=16

(1) Liquidity ratio.

(2) Profitability ratio.

(3) Activity ratio.

(4) Leverage ratio.

Or

(b) Following is the Income Statement of Arvind and Co. for the year ended on 31st March, 2023:                16

 Particulars Amt. Revenue from operations (sales) Add: Other Income Interest on Investment Profit on fixed assets 15,000 10,000 5,30,000     25,000 Total Revenue Less: Expenses Purchases Change in inventories (Opening stock – Closing stock) (Rs. 1,00,000 – Rs. 1,20,000) Wages Administrative Expenses Selling and Distribution Expenses Non-Operating Expenses 3,40,000     (20,000) 5,000 30,000 90,000 20,000 5,55,000                 4,65,000 Net Profit 90,000

You are required to calculate:

(a) Gross profit ratio.

(b) Net profit ratio.

(c) Operating ratio.

(d) Operating profit ratio.

5. (a) Define the term working capital. What factors would you take into consideration in estimating the working capital needs of a concern?         4+12=16

Or

(b) From the following information you are required to estimate the net working capital:  16

 Cost per unit (Rs.) Raw materials Direct labour Overheads (excluding depreciation) 400 150 300 Total cost 850