Download GTU (Gujarat Technological University) MBA (Master of Business Administration) 2019 Summer 2nd Sem 3529202 Cost And Management Accounting Cma Previous Question Paper
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA ? SEMESTER 2 ? EXAMINATION ? SUMMER 2019
Subject Code: 3529202 Date:10/05/2019
Subject Name: Cost & Management Accounting (CMA)
Time: 10:30 am to 1:30 pm Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q1. Define the following terms- (2*7=14)
a) Management accounting
b) Expire cost
c) Absorption costing
d) Marginal costing
e) Variance
f) Rolling budget
g) Equivalent production
Q2. (A) Differentiate between cost and management accounting? (07)
Q2. (B) what do you mean by cost ? Explain different types of cost (07)
OR
Q2. (B) what is target costing? How it helps an organization to control? (07)
Q3.(A). What are the different methods of depreciation and how it is applicable in Cost and
Management Accounting? (07)
Q3. (B) Differentiate between marginal costing and absorption costing. (07)
OR
Q3 (A) what is Kaizen costing? Explain with relevant example. (07)
Q3.(B) what is life cycle costing? Explain with some example. (07)
Q4. (A) What is strategic management accounting? Explain it with relevance of some real life
case. (07)
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Page 1 of 3
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA ? SEMESTER 2 ? EXAMINATION ? SUMMER 2019
Subject Code: 3529202 Date:10/05/2019
Subject Name: Cost & Management Accounting (CMA)
Time: 10:30 am to 1:30 pm Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q1. Define the following terms- (2*7=14)
a) Management accounting
b) Expire cost
c) Absorption costing
d) Marginal costing
e) Variance
f) Rolling budget
g) Equivalent production
Q2. (A) Differentiate between cost and management accounting? (07)
Q2. (B) what do you mean by cost ? Explain different types of cost (07)
OR
Q2. (B) what is target costing? How it helps an organization to control? (07)
Q3.(A). What are the different methods of depreciation and how it is applicable in Cost and
Management Accounting? (07)
Q3. (B) Differentiate between marginal costing and absorption costing. (07)
OR
Q3 (A) what is Kaizen costing? Explain with relevant example. (07)
Q3.(B) what is life cycle costing? Explain with some example. (07)
Q4. (A) What is strategic management accounting? Explain it with relevance of some real life
case. (07)
Page 2 of 3
Q4. (B) What is budgeting? How a budget is useful in a business organisation in different ways?
OR
Q4. (A) What is master budgeting? give Performa with hypothetical example. (07)
Q4. (B) How pricing decision helps an organization to work better? Explain aditya birla group as
case study of decision making. (07)
Q5. Priti Company produces industrial solvents. Two liquid solutions, Sol-A and Sol-B, are mixed
and heated to produce a solvent that is sold to companies for use in a process that removes
grease and oil from engines scheduled for recycling. After the liquid solvent is produced by
mixing and heating, it is placed in 50-gallon drums and moved to a warehouse. The compound
is produced in batches and has the following standards:
DIRECR MATERIAL STANDARD MIX
(GALLONS)
STANDARD UNIT
PRICE
STANDARD COST
SOL ? A 16000 Rs. 1.50 per gallon
7.50
Rs. 24000
SOL ? B 4000 30000
TOTAL 20000 Rs. 54000
YIELD 18000
During March, the following actual production information was provided:
DIRECR MATERIAL ACTUAL MIX (GALLONS)
SOL ? A 140000
SOL ? B 60000
TOTAL 200000
YIELD 162000
A. Compute the direct materials mix and yield variances.
B. Compute the total direct materials usage variance for Sol-A and Sol-B. Show that the
total direct materials usage variance is equal to the sum of the direct materials mix and
yield variance. (14)
OR
Q5. Sawasthi Ltd, a manufacturer of corporate jets, has just received an offer from a supplier to
provide 500 units of a component used in its main product. The component is a wheel assembly
that is currently produced internally. The supplier has offered to sell the wheel assembly for Rs
600 per unit. Sawasthi is currently using a functional, unit-based costing system that assigns
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Page 1 of 3
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA ? SEMESTER 2 ? EXAMINATION ? SUMMER 2019
Subject Code: 3529202 Date:10/05/2019
Subject Name: Cost & Management Accounting (CMA)
Time: 10:30 am to 1:30 pm Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q1. Define the following terms- (2*7=14)
a) Management accounting
b) Expire cost
c) Absorption costing
d) Marginal costing
e) Variance
f) Rolling budget
g) Equivalent production
Q2. (A) Differentiate between cost and management accounting? (07)
Q2. (B) what do you mean by cost ? Explain different types of cost (07)
OR
Q2. (B) what is target costing? How it helps an organization to control? (07)
Q3.(A). What are the different methods of depreciation and how it is applicable in Cost and
Management Accounting? (07)
Q3. (B) Differentiate between marginal costing and absorption costing. (07)
OR
Q3 (A) what is Kaizen costing? Explain with relevant example. (07)
Q3.(B) what is life cycle costing? Explain with some example. (07)
Q4. (A) What is strategic management accounting? Explain it with relevance of some real life
case. (07)
Page 2 of 3
Q4. (B) What is budgeting? How a budget is useful in a business organisation in different ways?
OR
Q4. (A) What is master budgeting? give Performa with hypothetical example. (07)
Q4. (B) How pricing decision helps an organization to work better? Explain aditya birla group as
case study of decision making. (07)
Q5. Priti Company produces industrial solvents. Two liquid solutions, Sol-A and Sol-B, are mixed
and heated to produce a solvent that is sold to companies for use in a process that removes
grease and oil from engines scheduled for recycling. After the liquid solvent is produced by
mixing and heating, it is placed in 50-gallon drums and moved to a warehouse. The compound
is produced in batches and has the following standards:
DIRECR MATERIAL STANDARD MIX
(GALLONS)
STANDARD UNIT
PRICE
STANDARD COST
SOL ? A 16000 Rs. 1.50 per gallon
7.50
Rs. 24000
SOL ? B 4000 30000
TOTAL 20000 Rs. 54000
YIELD 18000
During March, the following actual production information was provided:
DIRECR MATERIAL ACTUAL MIX (GALLONS)
SOL ? A 140000
SOL ? B 60000
TOTAL 200000
YIELD 162000
A. Compute the direct materials mix and yield variances.
B. Compute the total direct materials usage variance for Sol-A and Sol-B. Show that the
total direct materials usage variance is equal to the sum of the direct materials mix and
yield variance. (14)
OR
Q5. Sawasthi Ltd, a manufacturer of corporate jets, has just received an offer from a supplier to
provide 500 units of a component used in its main product. The component is a wheel assembly
that is currently produced internally. The supplier has offered to sell the wheel assembly for Rs
600 per unit. Sawasthi is currently using a functional, unit-based costing system that assigns
Page 3 of 3
overhead to jobs on the basis of direct labour-hours. The estimated function-based full cost of
producing the wheel assembly is as follows:
Direct materials Rs 370
Direct labour 100
Variable overhead 50
Fixed overhead 200
Prior to making a decision, the company?s CEO commissioned a special study to see whether
there would be any decrease in the fixed overhead costs. The results of the study revealed the
following:
? 3 setups ? Rs 4200 each (The setups would be avoided, and total spending could be
reduced by Rs 4200 per setup.)
? One less inspector needed Rs. 30000
? One less material handler needed, Rs 27000.
Engineering work: 615 hours, Rs20/hr. (Although the work decrease by 615 hours, the engineer
assigned to the wheel assembly line also spends time on other products.)
A. Ignore the special study, and determine whether the wheel assembly should be
produced internally or purchased from the supplier.
B. Now, using the special study data, repeat the analysis.
C. Discuss the qualitative factors that would affect the decision, including strategic
implications.
D. After reviewing the special study, the controller made the following remark: ?This study
ignores the additional activity demands that the purchasing would cause. For example,
although the demand for inspecting the part on the production floor decrease, will we
not have a need to inspect the incoming parts in the receiving area? Will we actually
save any inspection costs?? Is the controller right? Would this problem be avoided if
Sawasthi had an activity-based costing system in place?
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This post was last modified on 19 February 2020