Cost Accounting: Instructions To Candidates

Roll No. Total No.
of Pages : 04
Total No. of Questions : 09
B.Com. (Hons.) (2018 Batch) (Sem.–2)
COST ACCOUNTING
Subject Code : BCOM-201-18
M.Code : 75828
Time : 3 Hrs. Max. Marks : 60
INSTRUCTIONS TO CANDIDATES :
1. SECTION-A is COMPULSORY consisting of TEN questions carrying T WO marks
each.
2. SECTION-B consists of FOUR Sub-sections : Units-I, II, III & IV.
3. Each Sub-section contains T WO questions each, carrying T EN marks each.
4. Student has to attempt any ONE question from each Sub -section.
SECTION-A
1. Answer briefly :
a) Distinguish between direct and indirect cost.
b) From the following particulars calculate prime cost and factory cost :
Opening stock of Raw Material Rs. 50,000
Purchase of Raw Material Rs. 2,50,000
Freight inward Rs. 20,000
Closing stock of Raw Material Rs. 60,000
Indirect factory overheads Rs. 75,000.
c) What do you mean by reordering level of stock?
d) Explain the term labour turnover.
e) Explain the term economic ordering quantity.
f) Explain the term overhead.
g) Distinguish between allocation and absorption of overhead.
h) What do you mean by zero base budgeting?
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i) Define the term just in time (JIT).
j) Explain the term total quality management.
SECTION-B
UNIT-I
2. Prepare cost sheet from the following information of Reflex India Limited :
Opening Stock of Raw Material Rs. 4,40,000

Purchase of Raw Material Rs.25,60000
Closing Stock of Raw Material Rs. 6,00,000
Carriage on Purchases Rs. 50,000
Freight inward Rs. 30,000
Fuel and power Rs. 7,50,000
Factory rent Rs.2,50,000
Factory lighting Rs. 2,25,000
Wages and salaries Rs. 3,00,000
Salaries Rs.6,00,000
Office lighting Rs. 1,50,000
Depreciation on factory equipments Rs. 3,00,000
Depreciation on office assets Rs. 4,00,000
Opening Stock work in progress Rs. 6,00,000
Closing Stock work in progress Rs. 5,00,000
Advertisements Rs. 1, 50,000
Salesmen commission Rs. 2,00,000
Factory telephone Expenses Rs. 25,000
Office telephone Expenses Rs. 50,000
Opening stock of finished goods Rs. 7,50,000
Closing stock of finished goods Rs. 4,50,000
Selling Price 120% of total cost
3. “Limitations of financial accounting have made the management realize the importance
of cost accounting”. Comment.
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UNIT-II
4. From the following transactions, prepare stores ledger account using LIFO method :
Year 2018
1st July Opening stock 500 units @ Rs. 20 each
4th July Purchased GRN 574 500 units @ Rs. 21 each

6th July Issued SR 251 600 units
th
13 July Issued SR 262 200 units
30th July Purchased GRN 590 550 units @ Rs. 24.50 each
31st July Issued SR 268 500 units
Note: GRN = Goods received note and SR=stores Requisition
5. A worker produced 200 units in a week's time. The Guaranteed weekly wage payment
for 45 hours is Rs. 81. The expected time to produce one unit is 15 minutes which is
raised further 20% under incentive scheme. What will be earnings per hour of that
worker under Halsey (50%) Sharing and Rowan bonus schemes?
UNIT-III
6. From the following information for the year of 2018 Aabir Enterprises. You are required
to compute the following :
a) Profit Volume ratio
b) Variable cost
c) Break Even point
d) Profit if company has target sales of 2019, Rs. 45,00,000
e) Target sales to generate profit of Rs. 8,00,000
Sales Rs. 2,50,000
Fixed cost Rs. 4,00,000
Profit Rs. 6,00,000
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7. Indicate the reasons why it is necessary for the cost and financial. Accountant of an
organisation to be reconciled and explain the main reasons of differences which enter
into such account.
UNIT-IV
8. You are required to prepare flexible budget for overheads on the basis of data given
below. Ascertain the overhead rates 30%, 60% and 90 % Capacity.
At 30% At 60% At 90%

Capacity (Rs.) Capacity (Rs.) Capacity (Rs.)
Variable Overheads
Indirect material 48,000
Indirect labour 72,000
Semi Variable Overheads
Electricity 1,10,000
(20% fixed and 80% variable)
Repairs and maintenance 1,50,000
(50% fixed and 50% variable)
Fixed Overheads
Depreciation 60,000
Insurance 40,000
Salaries 100,000
Total Overheads 5,80,000
9. Write short notes on following :
a) Life cycle costing
b) Black flush costing
c) Activity based costing
NOTE : Disclosure of identity by writing mobile number or making passing request on any
page of Answer sheet will lead to UMC case against the Student.
4 | M-75828 (S12)-504

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Roll No. Total No.

Opening stock of Raw Material Rs. 50,000

Purchase of Raw Material Rs. 2,50,000

Freight inward Rs. 20,000

Closing stock of Raw Material Rs. 60,000

Indirect factory overheads Rs. 75,000.

c) What do you mean by reordering level of stock?

d) Explain the term labour turnover.

e) Explain the term economic ordering quantity.

f) Explain the term overhead.

g) Distinguish between allocation and absorption of overhead.

h) What do you mean by zero base budgeting?

j) Explain the term total quality management.

Opening Stock of Raw Material Rs. 4,40,000

4th July Purchased GRN 574 500 units @ Rs. 21 each

At 30% At 60% At 90%

9. Write short notes on following :

a) Life cycle costing

b) Black flush costing

c) Activity based costing

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