QP CODE: 20100480 Reg No : .....................

20100480 Name : .....................

BCOM DEGREE (CBCS) EXAMINATION, MARCH 2020

Sixth Semester
Core course - CO6CRT17 - COST ACCOUNTING - 2
B.Com Model II Computer Applications,B.Com Model II Finance & Taxation,B.Com Model II
Logistics Management,B.Com Model II Marketing,B.Com Model II Travel & Tourism,B.Com Model
III Computer Applications,B.Com Model III Office Management & Secretarial Practice,B.Com Model
III Taxation,B.Com Model III Travel & Tourism,B.Com Model I Finance & Taxation,B.Com Model I
Co-operation,B.Com Model I Computer Applications,B.Com Model I Marketing,B.Com Model I
Travel & Tourism
2017 Admission Onwards
D02454A0
Instruc ons for private candidates only: This ques on paper contains two sec ons. Answer SECTION I ques ons in the
answer book provided. SECTION II Internal Examina on ques ons must be answered in the ques on paper itself. Follow the detailed
instruc ons given under SECTION II.
SECTION I

Time: 3 Hours Maximum Marks :80

Part A
Answer any ten questions.
Each question carries 2 marks.

1. Explain the treatment of plant and machinery in contract accounts.

2. Compute economic batch quantity with the following information.

Annual demand for the component 24000 units
Set up cost per batch Rs. 200
Carrying cost per unit of output Rs. 0.50

3. What are the advantages of Cost plus contract to the contractee?

4. What are the cost units used in operating costing?

5. Cochin corporation Ltd employs 80 vehicles of 5 Tonnes capacity for the removal of its
garbage by motor vehicles transport. On an average each vehicle makes 4 trips a day,
covering a distance of 8 kms in each trip. Load actually carried is 80% of the capacity on
an average. Similarly on an average basis 20% of the vehicles are laid up for
maintenance on any given day. The vehicles run 30 days a month.
Calculate the Tonne- Kilometres per month.

6. Discuss features of by-products

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7. Discuss the treatment of Loss in Weight in process costing

8. Distinguish between Contribution and Profit.

9. How do the following reflect on break even point and p/v ratio
a) Increase in total fixed costs; b) Increase in total physical sales.

10. " Marginal costing is helpful for profit planning". explain.

11. Define Budget Centre.

12. What are the steps in performance budgeting?

(10×2=20)
Part B
Answer any six questions.
Each question carries 5 marks.

13. From the following information, prepare job cost sheet for Job. No. 150
Direct Material consumed Rs. 1,000
Direct Wages paid Rs. 2,000
Factory expenses 60% on wages
Office expenses 20% on factory cost
The tender should include a profit of 20% on selling price.
A transport company is running 4 buses between two towns which are 50 kms apart.
14.
Seating capacity of each bus is 40 passengers. The following particulars were obtained
from their books for April 2019.
Wages of Drivers and conductors 2,40,000
Office staff salary 1,00,000
Cost of Diesel and oil 4,00,000
Repairs and maintenance 80,000
Tax and Insurance 1,60,000
Depreciation 2,60,000
Interest and other charges 2,00,000
Actual passengers carried were 75% of the seating capacity. All the four buses run on
days of the month. Each us made one round trip per day. Find out the cost per passenger
kilometer.

15. Explain the methods of apportionment of joint cost.

16. You are given the following data:

Budgeted Output- 1,00,000 units
Fixed Expenses- Rs. 4,00,000
Variable cost per unit - Rs.10
Selling Price Per Unit- Rs. 20
Draw a Break Even Chart showing the Break Even Point.

17. Give a comparative description of absorption costing and marginal costing.

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18. From the following particulars calculate P/V Ratio, Break Even Sales, and Fixed Costs.
Profit ₹ 2000 which represents 10% of sales, Margin of Safety ₹ 10,000

19. A factory produces three products which originate from a joint process. Cost incurred and
the relevant details are:
Joint Costs:
Materials 30,000
Labour 14,000
Overheads 13,800
Total 57,800
Subsequent Processing Costs:
Product A Product B Product C
(Rs) (Rs) (Rs)
Material 7,000 6,000 5,000
Labour 3,000 2,400 1,800
Overheads 2,000 1,600 1,400
Total 12,000 10,000 8,200
Sales Value 56,000 44,000 30,000
Estimated profit on sales 25% 20% 30%
Prepare a statement showing apportionment of joint cost under Reverse cost method.

20. Godrej Ltd is currently operating at 70% of its capacity. In the past two years, the levels of
operations were 50% and 60% respectively. Presently, the production is 70,000 units. The
company is planning to utilize its full capacity during 2019-2020. The cost details are as
follows:

50% 60% 70%

Direct Materials (Rs) 1, 10,000 1, 30,000 1, 50,000
Direct Labour 55,000 65,000 75,000
Factory Overhead 31,000 33,000 35,000
Selling Overheads 32,000 36,000 40,000
Administra ve Overheads 16,000 16,000 16,000
2,44,000 2,80,000 3,16,000
The following increases in costs are expected during the year:
Direct Materials – 8%, Direct Labour and variable factory overheads at 5%, Variable selling
overheads -8%, fixed factory overheads and administra on overheads at 10% and fixed selling
overheads at 15%. Prepare a flexible budget for the period 2019-2020 at 100% capacity.

21. Enumerate the steps involved in budgetary control.

(6×5=30)
Part C
Answer any two questions.
Each question carries 15 marks.

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22. The following particulars relate to a contract for Rs. 40,00,000
2017 2018 2019
Rs Rs Rs
Materials 4,50,000 7,00,000 6,00,000
Wages 4,30,000 6,00,000 5,00,000
Expenses 20,000 50,000 16,000
Carriage 20,000 60,000 50,000
Work Certified 9,00,000 30,00,000 40,00,000
Work Uncertified 10,000 50,000 -
Plant costing Rs. 1,00,000 was purchased in the beginning of the contract and
depreciation was charged at 25% per annum. The contractee was to pay 80% of work
certified every year and settle the account in 2019. Prepare Contract account and
Contractees account for three years.

23. The product of Alpha company Ltd pass through 3 processes X, Y& Z. The normal
wastage of the three process are 2%, 5%, & 10% respectively which are to be calculated
on the number of units that enter into each process. The scrap value of wastage of each
process are Rs10, Rs40, & Rs20 per 100 units respectively. It is assumed that output of
each process is transferred to next process. Prepare process accounts on the basis of the
following information .
X Y Z
Materials consumed 6000 2000 2000
Direct labour 4000 3000 3000
Manufacturing Expenses 1000 2000 1000
10,000 units were put into process X at a cost of Rs 8000. The output of each process has been
X- 9800 units Y- 9200 units Z-8350 units

24. The following set of information is presented to you by your client ACC Ltd. producing two
Products X and Y
Particulars X (₹) Y (₹)
Direct Material cost per unit 20 18
Direct wages per unit 6 4
Selling price per unit 40 30
Fixed Overhead : ₹ 1600
Variable Overhead : 100% of Direct wages
Proposed Sales Mix :

1. 100 units of X and 200 units of Y

2. 150 units of X and 150 units of Y
3. 200 units of X 100 units of Y

As a cost accountant you are requested to present the management of ACC Ltd. the
following:

1. Marginal Cost and contribution per unit

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 2. Total contribution and profit from each sales mix
3. The propsed sales mixes to earn a profit of ₹ 300 and ₹ 600 with total sales of X
and Y being 300 units.

25. Prepare a cash budget for the three months from 2018 July to September from the given
informa on
May June July August September
Sales 95,000 1,10,000 1,50,000 1, 25,000 1, 35,500
Purchases 80,000 78,000 1,10,000 1,20,000 1, 00,000
Wages 6,000 7,500 8,800 9,000 8,400
Factory overheads 3200 1280 780 2,300 840
Admn. Expenses 6,000 6,200 6,800 9,500 4,700
Selling expenses 4.000 4,500 4,300 4,400 5,200

Addi onal informa on:

A dividend of Rs. 10,500 will be paid in June
Period of credit allowed by suppliers is two months and to customers 8 weeks
Time lag for making payments of wages and overheads
Wages 1/8th month
Factory overheads 4 weeks
Administra on overheads 6 weeks
Selling overheads 6 weeks
Plant purchased, June- 28,000, payable on delivery
Machinery purchased, June Rs 60,000, payable in two half yearly ins lments, the first in July.
Cash and bank balance on 1st July, 2018 was Rs. 18,000.
(2×15=30)

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