Tuesday, August 28, 2012

Dibrugarh University (M.Com - Distance) - Cost and Management Accounting


2010 (August)
Paper: 103
Full Marks: 80
Time: 3 hours

1.       (a) What is activity-based costing? Discuss how it can be implemented in any industry with which you are familiar.   6+10=16
Or
(b) What do you understand by cost reduction? Indicate the areas of cost reduction campaign.   7+9=16

2.       (a) Mr. Dutta has started a transport business with a fleet of 10 taxis. The various expenses incurred by him are given below:  16
(i)      Cost of each taxi Rs. 75000
(ii)    Salary of office staff Rs. 1500 p.m.
(iii)   Salary of garage staff Rs. 2000 p.m.
(iv)  Rent of garage Rs. 1000 p.m.
(v)    Driver’s salary (per taxi) Rs. 400 p.m.
(vi)  Road tax and repairs (per taxi) Rs. 2160 p.a.
(vii) Insurance premium                @ 4% p.a. on the cost of vehicle.
The life of a taxi is 300000 km and at the end of which it is estimated to be sold at Rs. 15000. A taxi runs on an average 4000 km per month of which 20% it runs empty. Petrol consumption is 9km per litre of petrol costing Rs. 6.30 per litre. Oil and other sundry expenses amount to Rs. 10 per 100 km.
Calculate the effective cost of running taxi per km. If the hire charge is Rs. 1.80 per km, find out the profit Mr. Dutta may expect to make in the first year of operation.
Or
(b) From the following information, find out the profit made by each product, apportioning joint costs on the sales – value basis      16

Joint Cost
Amount (Rs.)


Direct Materials
Power
Petrol, Oil, Lubricants
Labour
Other charges
126000
25000
5000
7500
4100

Particulars
Product X
Product Y
Selling Costs
Sales
20000
152000
                          80000
168000

3.       (a) From the following Balance sheet of A. Ltd., Prepare a position statement as on that date and comment on the financial position of the company:    16
Balance Sheet of A Ltd. As on 31st December, 2010
Liabilities
Amount
Assets
Amount
Share Capital
Authorised:
Issued and Subscribed:
15000 equity shares of Rs.10/- each called up
Reserves and Surplus:
Capital reserve
General Reserve
Secured and Unsecured Loans
Current Liabilities



150000


40000
30000
80000
45000
Fixed Assets:
Plant and Machinery
Other Fixed Assets
Investments (Long Term)
Current assets

105000
85000
25000
130000

Total
345000

345000

Or
(b)Explain trend percentages as a tool of analysis highlighting on methods of calculation, advantages, limitations and precautions to be taken.  5+5+6=16               

4.       (a) The profit of a company is Rs. 50,000 after charging interest of Rs. 6000 on debentures and providing Rs. 24000 for taxes, the assets of the company consists of fixed assets Rs. 200000, current assets Rs. 600000 and preliminary expenses Rs. 30000, Discount on issue of debenture is Rs. 10000. Compute the return on capital employed.  16
Or
(b) What is ratio analysis? State the objects of Balance sheet ratios.  5+11=16

5.       (a) In calculation of figures for working capital projection, what are the time lag for payments to creditors for goods and time lag in payment of expenses and how they are calculated?   8+8=16
Or
(b) Show the classification of working capital on different basis, depending on the purpose of analysis.  16

Monday, August 27, 2012

Dibrugarh University (M. Com - Distance) - Cost and Management Accounting


2011 (August)
Paper: 103
Full Marks: 80
Time: 3 hours

1.       (a) Explain briefly the evolution of cost accounting system and cost concepts.  8+8=16
Or
(b) Briefly explain the distinction between cost control and cost reduction.  16

2.       (a) The following figures are extracted from the financial accounts of a manufacturing firm for the first year of its operation:
Particulars
Amount
Direct material consumption
Direct wages
Factory overheads
Administrative overheads
Selling and distribution overheads
Bad debts
Preliminary expenses written off
Legal charges
Dividend received
Interest on deposit received
Sales (120000 units)
Closing stock:
Finished stock (4000 units)
Work -  in - progress
5000000
3000000
1600000
700000
960000
80000
40000
10000
100000
20000
1200000

320000
240000

The cost accounts for the same period reveal that the direct material consumption was Rs. 56,00,000.  Factory overhead is recovered at 20% on prime cost. Administrative overhead is recovered @ Rs. 6 per unit of production. Selling and distribution overhead are recovered @ Rs.8 per unit sold.
You are required to prepare costing and Financial profit and loss accounts and reconcile the difference in the profits as arrived at in the two sets of accounts.  16
Or
(b) A product passes through three processes to completion. These processes are known as X, Y and Z. The output of each process is charged to the next process at a price calculated to give a profit of 20% on the transfer price. The output of process Z is charged to finished stock in a similar basis.
There was no partly finished work in any process on December 31, on which date the following information was obtained:
Particulars
Process X (Rs.)
Process Y (Rs.)
Process Z (Rs.)
Materials
Labour
Stock: Dec 31
4000
6000
2000
6000
4000
4000
2000
8000
6000
Stock in each process were valued at price cost to the process. There was no stock in hand on January 1st and question of overhead was ignored. Of the goods passed into finished stock, Rs. 4000 remained in hand on December 31, and the balance has been sold for R.s 36000. Show process accounts and calculate reserve for unrealised profits.  16

3.       (a) what are the different methods and devices used in analysis of financial statements? Explain one of them. 8+8=16
Or
(b)What do you understand by comparative statements? Explain its merits and demerits.  8+8=16

4.       (a) Compare the following capital structures (is Rs. ‘000)
Particulars
A Ltd.
B. Ltd.
C Ltd.
Equity share capital
10% preference share capital
Reserves and surplus
15% secured debentures
100
50
50
400
150
100
50
300
250
-----
50
300
Total
600
600
600
Assume tax rate @50%. Expected profit before interest and taxes but after all expenses and depreciation in each case Rs. 72000.   16
Or
(b) Explain the Balance Sheet ratios.  16

5.       (a) What is “operating cycle concept”? What steps should be taken into account while deciding the working capital requirements of an organisation?  6+10=16
Or
(b) From the following information pertaining to X Ltd, you are required to prepare a Forecast Profit and Loss account for the year ended 30th june, 2011 and Balance sheet as on that date:
Paid – up share capital
8% Debentures (Secured on assets)
Fixed assets as on 1st july, 2010
Bank overdraft as on 1st july, 2010
1000000
250000
625000
181250
Production during the previous year was 60000 units. It is expected that this level of activity would be maintained during the current year.
The expected ratios of cost of selling prices are-
Raw materials 60%, Direct wages 10%, Overheads (Including debentures interest) 20%.
Raw materials remain in store on an average for 2 months.
Materials remain in process (Valued at cost of raw materials plus 50% of direct wages and overheads) on an average for one month.
Finished goods remain in stock on an average for three months.
Credit allowed by creditors is two months and credit allowed to debtors is three months.
Selling price is Rs. 25 per unit.
You are required that there is a regular production cycle and sales cycle.  16

Dibrugarh University (M. Com - Distance) - Cost and Management Accounting

2009 (August)
Paper: 103
Full Marks: 80
Time: 3 hours

1.       (a) Write briefly on the evolution of Cost accounting system and Cost concepts. 8+8=16
Or
(b) What are the differences between Activity Based Costing and Conventional Costing and How is cost analysis under activity Based costing is done.  8+8=16

2.       (a) Union Transport company supplied the following details in respect of a truck of 5 tonnes capacity:
Particulars
Amount (Rs.)
Cost of Truck
Estimated Life
Repairs and Maintenance
Driver’s wages
Insurance
General supervision charges
Scrap value
Diesel, Oil, Grease
Cleaner’s wages
Tax
90000
10 years
500 p.m.
500 p.m.
4800 p.a.
4800 p.a.
4500
15 per trip per day
250 p.m.
2400 p.a.
The Truck carries goods to and from the city covering a distance of 50 miles each way. On outward trip freight is available to the extent of full capacity and on return 20% capacity. Assuming that the truck runs on an average 25 days a month, work out:
(a)    Operating cost per tonne mile.
(b)   Rate per tonne per trip that the company should charge if a profit of 50% on freightage is to be earned.    16
Or
(b) An article passes through three successive operations from the raw materials to the finished product stage. The following data are available from the production records of a particular month:
Operation No.
No. of process input
No. of pieces rejected
No. of pieces output
1
2
3
60000
66000
48000
20000
6000
8000
40000
60000
40000
(i)      Determine the input required to be introduced in the first operation in number of pieces in order to obtain finished output of 100 pieces after the last operation.
(ii)    Calculate the cost or raw materials required to produce one piece of finished product, given the following information weight of the finished piece is 0.10kg and the price of raw material is Rs. 20 per kg.    16

3.       (a) Explain the techniques of financial statement analysis.   16
Or
(b) Explain the procedure for interpretation of accounts.   16

4.       (a) The following are the summarized Profit and loss account of S Product Limited for the year ended on 31st December, 2008 and the balance sheet as on that date:
Particulars
Amount
Particulars
Amount
To Opening Stock
To Purchases
To Incidental Expenses
To Gross Profit c/d

To Operating Expenses:
Selling and Distribution
Administration
Finance
To Non-operating expenses:
Loss on sale of assets
99500
545250
14250
340000
999000

30000
150000
15000


4000
349000
By Sales
By Closing Stock



By Gross Profit b/d
By Non-operating Incomes:
Interest
Profit on sale of shares



850000
149000


999000
340000

3000
6000



349000
Balance Sheet as on
Liabilities
Amount
Assets
Amount
Issued capital
2000 Equity shares @ Rs. 100 each
Reserve
Current liabilities
Profit and Loss Account

200000
90000
130000
60000
480000
Land and Building
Plant and Machinery
Stock – in – trade
Sundry Debtors
Cash and Bank Balance
150000
80000
149000
71000
30000
480000
From the following statements you are required to calculate the following ratios and state the purposes they serve:
(a)    Current ratio
(b)   Operating ratio
(c)    Stock turnover ratio
(d)   Return on capital employed
(e)   Earning per share
(f)     Operating profit ratio       16
Or
(b) Elucidate the functional classification of ratios.   16

5.       (a) How shall you project working capital requirements in case of trading and manufacturing organisations?  8+8=16
Or
(b) What are the factors affecting the amount of working capital in an organisation and also show in detail the classification of working capital.   8+8=16

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