QP CODE: 21101150 21101150

  Reg No : .....................

    Name : .....................

B.COM DEGREE (CBCS) EXAMINATION, APRIL 2021

Sixth Semester
CORE - CO6CRT17 - COST ACCOUNTING - 2
Common for 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, 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 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
2017 Admission Onwards
C15057B7
Time: 3 Hours Max. Marks : 80
Instructions to Private candidates only: This question paper contains two sections. Answer SECTION I
questions in the answer-book provided. SECTION II, Internal examination questions must be answered in the
question paper itself. Follow the detailed instructions given under SECTION II

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

1.   What is work certified?

2.   Calculate EBQ

Annual Demand               50,000 units

Setting up cost                 Rs. 100 per unit

Interest on capital             10%

Cost of storage per unit    50 paise

Cost of manufacturing       Rs. 20 per unit

3.   A transport company operates 4 buses between two cities which are 100 kms apart.
Each bus makes 3 round trips per day. The seating capacity of the buses are 50
passengers. The buses operate on all days during the month of April 2019. On an
average all the buses run with 80% capacity.

Calculate total kilometres run and passenger kilometres.

4.   What is operation costing?

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 5.   What are the Limitations of Cost Plus Contract to the Contractor?

6.   What is process costing?

7.   What is Normal Process Loss?.

8.   Why are P/V ratio and Margin of safety calculated?

9.   Describe how the following factors will have an impact on the break even point and profit
volume ratio:

a) Increase in sales quantity ; b) Increase sales price per unit

10.   Define Marginal Costing. Point out the limitations of marginal costing.

11.   What is Budgeting?

12.   What are the advantages and disadvantages of ZBB? ( any two)

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

13.   Printwell ltd, took up two jobs during the first week of April 2019. Following details are
available:

                                                                                        Job 101                    Job 102

Materials supplied                                                    Rs.  2100                         1400

Wages paid                                                                        900                           600

Materials transfered from 102 to 101                                 100                           100

Material returned to stores                                                    -                               50

find the cost of each job

14.   From the following data calculate the cost per running kilometers of a vehicle:
Value of Vehicle                                                                               1,50,000

Garage rent per year                                                                            6,000

Insurance charge per year                                                                   1,000

Road lcience  per year                                                                         5,000

Driver’s wage per  month                                                                     2,000

Cost of diesel per litre                                                                                  8

Tyre maintenance per kilometers                                                                2

Estimated life                                                                 1,50,000 kilometers

Kilometers per litre of diesel                                                                        8

Estimated annual kilometers  run                                                         6,000

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15.   write short notes on: a) Physical unit method b)Average unit cost method c) survey
method d)Contribution Margin method, and e) standard cost method of apportioning joint
cost among joint product.

16.   A factory produces three products which originate from a joint process. Cost incurred and the
relevant details are:

Joint Costs:
Materials 15,000
Labour 7,000
Overheads 6,900
Total 28,900
 

Subsequent Processing Costs:

  Product   A
Product  B
Product  C

(Rs) (Rs) (Rs)

Material 3,500 3,000 2,500
Labour 1,500 1,200 900
Overheads 1,000 800 700
                       Total 6,000 5,000 4,100
Sales Value 28,000 22,000 15,000
Estimated profit on sales 25% 20% 30%

Prepare a statement showing apportionment of joint cost under Reverse cost method.

17.   Raymond Limited has prepared the budget for the production of 1,00,000 units from a
costing period as under: 

                                                                                                       Per unit(Rs)

Raw materials                                                                                       10.08

Direct Labour                                                                                          3.00

Direct expenses                                                                                      0.40

Works Overheads (60% fixed)                                                               10.00

Administration overhead (80%fixed)                                                        1.60

Sales overhead (50% fixed)                                                                     0.80

        Actual production in the period was only 60,000 units. Prepare budgets for the
original and revised levels of output.

The fixed cost of a concern amounts to ₹ 80,000 and percentage of varible cost is 60%. 
18.  
If sales at 100% capacity is ₹ 5,00,000, find out Break even Point and Percentage of
Sales when it occured. Determine profit at 75% Capacity.

19. What are the preliminaries taken for the installation of a system of Budgetary Control?  

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 20.   Explain the distinguishing features of absorption costing.

21.   You are given the following data:

Budgeted Output- 1,00,000 units

Fixed Expenses- Rs. 2,00,000

Variable cost per unit - Rs.6

Selling Price Per Unit- Rs. 10

Draw a Break Even Chart showing the Break Even Point.

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

22.   KHB Construction Ltd has undertaken two contracts on Oct 1, 2018. The position of the
contracts on September 30, 2019 is as follows-

                                                                                             Contract I                   Contract
II
                                                                                                   Rs                               Rs

Contract Price                                                                       27,00,000                 

60,00,000

Materials                                                                                 5,80,000                 
10,80,000

wages paid                                                                            11,24,000                 

16,50,000

other expenses                                                                           28,000                     

 60,000

Plant at site                                                                              1,60,000                   

3,00,000

unused materials at site                                                              40,000                     

 60,000

wages accrued                                                                            36,000                     

 54,000

other expenses due                                                                       4,000                       

 9,000

work certified                                                                          16,00,000                 

30,00,000

cash received                                                                          12,00,000               

 22,50,000

work uncertified                                                                            80,000                     

90,000

The plant at site is to be depreciated at 10%. Prepare the contract account in respect of

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 each work showing the notional profit and profit to be transferred to profit and loss
account.

23.   Product  Z  is obtained after it passes through three distinct processes. Following information’s  is
available
  Process 1 Process 11 Process 111 Total
Direct materials 2600 1980 2962 7542
Direct labour 2000 3000 4000 9000
Production --------------- -------- ------------- 9000
overheads

1,000 units @ Rs.3 each were introduced to Process 1. Production overhead is recovered on 100%
of direct wages. Following additional data are obtained:
Process Out put percentage of Value of scrap per
normal loss to input unit
1 950 5% 2
11 840 10% 4
111 750 15% 5

Prepare process Account and Abnormal Gain or Loss Account.

A company has capcity of producing 1,00,000 units of a certain product in a month . The

24.  
schedule of prices is given below

                  Volume of Output                               Selling prices per unit

                         (%)                                                             (₹)

                          60                                                              90

                          70                                                              80

                          80                                                              75

                          90                                                              67

                         100                                                             61

    The variable cost of manufacture is ₹ 15 per unit and fixed costis ₹ 40 Lakhs.

1. State at what volume of production will the profit be maximum?

2. If there is a bulk offer at ₹ 40 per unit for the balance capacity over maximum
profit volume for export and the price quoted will not affect the international
and local market , will u advice accepting this bid? Acceptance will entail an
additional fixed cost of ₹ 1,00,000 per month.

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25.   From the following information, prepare a cash budget for the month April, May and June 2018

Month                     Sales                        Purchases                   Wages                        Overheads

February                  90,000                     86,000                            5,000                          6,000

March                   1, 00,000                    70,000                            3,000                          5,000

April                         95,000                      87,000                           6,000                           5,000    

May                        80,000                        60,000                           4,000                          7,200

June                      1, 20,000                      60,000                          5,000                          8,000

Customers credits are allowed a period of one month.

Creditors allowed a time lag of two months for making payments.

Time lag in payment of wages is one month. Overheads of a month are paid in the first week of
the next month.

A plant is to be purchased for cash in May for Rs. 22,000.

All purchases and sales are on credit terms.

Opening cash balance is Rs. 8500

 
(2×15=30)

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