Download GTU (Gujarat Technological University) MBA (Master of Business Administration) 2018 Winter 3rs Sem 3539905 Cost And Management Accounting Cma Previous Question Paper
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (PART TIME) ? SEMESTER 3 ? EXAMINATION WINTER ? 2018
Subject Code: 3539905 Date: 07/12/ 2018
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.
Q.1 Define the following terms:
(a) Sunk Cost
(b) Replacement Cost
(c) Cost Object
(d) Marginal Costing
(e) Joint Cost
(f) Spilt-off point
(g) Margin of safety
14
Q.2 (a) From the following information, prepare a statement showing the cost and
profit.
Particulars Opening Closing
Raw Materials
Work-in-progress
Materials
Wages
Works Overheads
Finished Goods
Rs. 17,700
8,160
6,600
3,960
200 units @ Rs. 50.4
Rs. 21,600
7,200
9,900
5,940
1,600 units
Purchases raw materials Rs. 1,14,000, Carriage on purchases, Rs. 900,
Sale of scrap of raw materials Rs.3,000
Wages Rs.1,78,200
Works overheads are 60% of direct labour cost.
Administration overheads are absorbed at Rs.7.20 per unit produced.
Selling & Distribution overheads are absorbed at 20% of selling price.
Sales ? 7,600 units @ profit of 10% on sales price.
07
(b) What is Cost Accounting? Distinguish between ?Cost Accounting? and
?Financial Accounting?.
07
OR
(b) Explain the Make or Buy Decisions in context of the following under
mentioned statements: If Purchase Price < Variable Cost, go for purchase
proposition. If Purchase Price > Variable Cost, go for manufacturing
proposition.
07
Q.3 (a) Explain the concept of Transfer Pricing. 07
(b) Write a note on Kaizen costing & Life cycle costing. 07
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Page 1 of 4
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (PART TIME) ? SEMESTER 3 ? EXAMINATION WINTER ? 2018
Subject Code: 3539905 Date: 07/12/ 2018
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.
Q.1 Define the following terms:
(a) Sunk Cost
(b) Replacement Cost
(c) Cost Object
(d) Marginal Costing
(e) Joint Cost
(f) Spilt-off point
(g) Margin of safety
14
Q.2 (a) From the following information, prepare a statement showing the cost and
profit.
Particulars Opening Closing
Raw Materials
Work-in-progress
Materials
Wages
Works Overheads
Finished Goods
Rs. 17,700
8,160
6,600
3,960
200 units @ Rs. 50.4
Rs. 21,600
7,200
9,900
5,940
1,600 units
Purchases raw materials Rs. 1,14,000, Carriage on purchases, Rs. 900,
Sale of scrap of raw materials Rs.3,000
Wages Rs.1,78,200
Works overheads are 60% of direct labour cost.
Administration overheads are absorbed at Rs.7.20 per unit produced.
Selling & Distribution overheads are absorbed at 20% of selling price.
Sales ? 7,600 units @ profit of 10% on sales price.
07
(b) What is Cost Accounting? Distinguish between ?Cost Accounting? and
?Financial Accounting?.
07
OR
(b) Explain the Make or Buy Decisions in context of the following under
mentioned statements: If Purchase Price < Variable Cost, go for purchase
proposition. If Purchase Price > Variable Cost, go for manufacturing
proposition.
07
Q.3 (a) Explain the concept of Transfer Pricing. 07
(b) Write a note on Kaizen costing & Life cycle costing. 07
Page 2 of 4
OR
Q.3 (a) Explain the various steps involved in the decision ? making process? 07
(b) Standard material required for manufacturing 100kg. chemical X is given
below:
45 kg. of Material A at Rs 2 per kg.
40kg. of Material B at Rs. 4 per kg.
25 kg. of Material C at Rs. 6 per kg.
The standard loss is 10 kg.
During the 42
nd
week, 2000 kg. of chemical X were produced and the
actual usage of material were as follows:
Material A- 1000 kg. at Rs. 1.90 per kg.
Material B- 850 kg. at Rs. 4.20 per kg.
Material C-450 kg. at Rs. 6.50 per kg.
You are required to calculate all the necessary variances.
07
Q.4 (a) A Bright Ltd. manufactures two products- Bright and Delight, using the
same equipment and similar processes. The following information is
extracted from the production department pertaining to the two products
for the quarter ending 31 December 2007:
Particulars Bright Delight
Quantity produced (units) 10000 15000
Direct labour hours per unit 2 4
Machine-hours per unit 3 1
Number of set-ups in the period 20 80
Number of orders handled in the period 30 120
The production overheads recovered for the period has been analysed as
follows:
Particulars Rs.
Relating to machine activity 4,50,000
Relating to production run set-ups 40,000
Relating to handling of orders 90,000
5,80,000
You are required to calculate the production overheads to be absorbed by
each unit of the products using the following costing methods:
i. A traditional coating approach, using a direct labour hour rate to
absorb overheads.
ii. An ABC approach, using suitable cost drivers to trace overheads to
products.
07
(b)
XYZ Ltd. manufactures toys. Fixed Cost amount to Rs. 2,70,000 per year.
Variable costs per toy are Rs. 23, and the average price per toy is Rs. 50.
(i) How many toys must XYZ Ltd. sell to break even?
(ii) If XYZ Ltd. sells 16,000 toys in a year, what is the operating income?
(iii) If XYZ Ltd. variable costs decreases to Rs. 20 per toy while the price and
fixed costs remain unchanged, what is the new break-even point?
07
OR
Q.4 The following records are available from the records of a manufacturing 14
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Page 1 of 4
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (PART TIME) ? SEMESTER 3 ? EXAMINATION WINTER ? 2018
Subject Code: 3539905 Date: 07/12/ 2018
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.
Q.1 Define the following terms:
(a) Sunk Cost
(b) Replacement Cost
(c) Cost Object
(d) Marginal Costing
(e) Joint Cost
(f) Spilt-off point
(g) Margin of safety
14
Q.2 (a) From the following information, prepare a statement showing the cost and
profit.
Particulars Opening Closing
Raw Materials
Work-in-progress
Materials
Wages
Works Overheads
Finished Goods
Rs. 17,700
8,160
6,600
3,960
200 units @ Rs. 50.4
Rs. 21,600
7,200
9,900
5,940
1,600 units
Purchases raw materials Rs. 1,14,000, Carriage on purchases, Rs. 900,
Sale of scrap of raw materials Rs.3,000
Wages Rs.1,78,200
Works overheads are 60% of direct labour cost.
Administration overheads are absorbed at Rs.7.20 per unit produced.
Selling & Distribution overheads are absorbed at 20% of selling price.
Sales ? 7,600 units @ profit of 10% on sales price.
07
(b) What is Cost Accounting? Distinguish between ?Cost Accounting? and
?Financial Accounting?.
07
OR
(b) Explain the Make or Buy Decisions in context of the following under
mentioned statements: If Purchase Price < Variable Cost, go for purchase
proposition. If Purchase Price > Variable Cost, go for manufacturing
proposition.
07
Q.3 (a) Explain the concept of Transfer Pricing. 07
(b) Write a note on Kaizen costing & Life cycle costing. 07
Page 2 of 4
OR
Q.3 (a) Explain the various steps involved in the decision ? making process? 07
(b) Standard material required for manufacturing 100kg. chemical X is given
below:
45 kg. of Material A at Rs 2 per kg.
40kg. of Material B at Rs. 4 per kg.
25 kg. of Material C at Rs. 6 per kg.
The standard loss is 10 kg.
During the 42
nd
week, 2000 kg. of chemical X were produced and the
actual usage of material were as follows:
Material A- 1000 kg. at Rs. 1.90 per kg.
Material B- 850 kg. at Rs. 4.20 per kg.
Material C-450 kg. at Rs. 6.50 per kg.
You are required to calculate all the necessary variances.
07
Q.4 (a) A Bright Ltd. manufactures two products- Bright and Delight, using the
same equipment and similar processes. The following information is
extracted from the production department pertaining to the two products
for the quarter ending 31 December 2007:
Particulars Bright Delight
Quantity produced (units) 10000 15000
Direct labour hours per unit 2 4
Machine-hours per unit 3 1
Number of set-ups in the period 20 80
Number of orders handled in the period 30 120
The production overheads recovered for the period has been analysed as
follows:
Particulars Rs.
Relating to machine activity 4,50,000
Relating to production run set-ups 40,000
Relating to handling of orders 90,000
5,80,000
You are required to calculate the production overheads to be absorbed by
each unit of the products using the following costing methods:
i. A traditional coating approach, using a direct labour hour rate to
absorb overheads.
ii. An ABC approach, using suitable cost drivers to trace overheads to
products.
07
(b)
XYZ Ltd. manufactures toys. Fixed Cost amount to Rs. 2,70,000 per year.
Variable costs per toy are Rs. 23, and the average price per toy is Rs. 50.
(i) How many toys must XYZ Ltd. sell to break even?
(ii) If XYZ Ltd. sells 16,000 toys in a year, what is the operating income?
(iii) If XYZ Ltd. variable costs decreases to Rs. 20 per toy while the price and
fixed costs remain unchanged, what is the new break-even point?
07
OR
Q.4 The following records are available from the records of a manufacturing 14
Page 3 of 4
company for two level of activity:
Particulars 60% (Rs.) 100% (Rs.)
Direct Material 9000 15000
Direct wages 6000 10000
Indirect wages 3000 5000
Repair & Maintenance 6500 9500
Power & fuel 3750 5750
Rent 12000 12000
Depreciation 10000 10000
Insurance 6000 6000
Administrative overheads 10000 14000
Selling overheads 6000 8000
Total production at 100% capacity is 5000 units. Draw up Flexible Budget
at 70 % , 90% and 110% of normal capacity.
Q.5
CASE STUDY:
Rahul Ltd. is engaged in process engineering industry. During the month
of April, 2,000 units were introduced in Process A. The normal loss was
estimated at 5 % of input. At the end of the month, 1,400 units had been
produced and transferred to Process B, 460 units were incomplete. The
entire process had to be scrapped. The incomplete units had reached the
following stages of completion:
Materials 75 % completed
Labour 50 % completed
Overheads 50 % completed
Following are the additional information on Process A:
Cost of 2,000 units Rs. 58,000
Additional Direct Materials Rs. 14,400
Direct Labour Rs. 33,400
Direct Overheads Rs. 16,700
Units scrapped realized Rs. 10 each
You are required to prepare the following:
(i) Statement of Equivalent Production,
(ii) Statement of Cost per Equivalent Units,
(iii) Statement of Evaluation;
(iv) Process A Account, and
(v) Abnormal Loss/Gain Account.
14
OR
Q.5
CASE STUDY:
Vinayak Ltd. operating at 75% level of activity produces and sells two
products, A and B. The cost sheets of the two products are as under:
Particulars Product A Product B
Units produced and sold
Direct Materials
Direct Labour
Factory overheads (40% fixed)
Selling and administration
overheads (60% fixed)
Total cost per unit
Selling price per unit
600
Rs. 2
Rs. 4
Rs. 5
Rs. 8
Rs. 19
Rs. 23
400
Rs. 4
Rs. 4
Rs. 3
Rs. 5
Rs. 16
Rs. 19
Factory overheads are absorbed on the basis of machine-hours which is
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Page 1 of 4
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (PART TIME) ? SEMESTER 3 ? EXAMINATION WINTER ? 2018
Subject Code: 3539905 Date: 07/12/ 2018
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.
Q.1 Define the following terms:
(a) Sunk Cost
(b) Replacement Cost
(c) Cost Object
(d) Marginal Costing
(e) Joint Cost
(f) Spilt-off point
(g) Margin of safety
14
Q.2 (a) From the following information, prepare a statement showing the cost and
profit.
Particulars Opening Closing
Raw Materials
Work-in-progress
Materials
Wages
Works Overheads
Finished Goods
Rs. 17,700
8,160
6,600
3,960
200 units @ Rs. 50.4
Rs. 21,600
7,200
9,900
5,940
1,600 units
Purchases raw materials Rs. 1,14,000, Carriage on purchases, Rs. 900,
Sale of scrap of raw materials Rs.3,000
Wages Rs.1,78,200
Works overheads are 60% of direct labour cost.
Administration overheads are absorbed at Rs.7.20 per unit produced.
Selling & Distribution overheads are absorbed at 20% of selling price.
Sales ? 7,600 units @ profit of 10% on sales price.
07
(b) What is Cost Accounting? Distinguish between ?Cost Accounting? and
?Financial Accounting?.
07
OR
(b) Explain the Make or Buy Decisions in context of the following under
mentioned statements: If Purchase Price < Variable Cost, go for purchase
proposition. If Purchase Price > Variable Cost, go for manufacturing
proposition.
07
Q.3 (a) Explain the concept of Transfer Pricing. 07
(b) Write a note on Kaizen costing & Life cycle costing. 07
Page 2 of 4
OR
Q.3 (a) Explain the various steps involved in the decision ? making process? 07
(b) Standard material required for manufacturing 100kg. chemical X is given
below:
45 kg. of Material A at Rs 2 per kg.
40kg. of Material B at Rs. 4 per kg.
25 kg. of Material C at Rs. 6 per kg.
The standard loss is 10 kg.
During the 42
nd
week, 2000 kg. of chemical X were produced and the
actual usage of material were as follows:
Material A- 1000 kg. at Rs. 1.90 per kg.
Material B- 850 kg. at Rs. 4.20 per kg.
Material C-450 kg. at Rs. 6.50 per kg.
You are required to calculate all the necessary variances.
07
Q.4 (a) A Bright Ltd. manufactures two products- Bright and Delight, using the
same equipment and similar processes. The following information is
extracted from the production department pertaining to the two products
for the quarter ending 31 December 2007:
Particulars Bright Delight
Quantity produced (units) 10000 15000
Direct labour hours per unit 2 4
Machine-hours per unit 3 1
Number of set-ups in the period 20 80
Number of orders handled in the period 30 120
The production overheads recovered for the period has been analysed as
follows:
Particulars Rs.
Relating to machine activity 4,50,000
Relating to production run set-ups 40,000
Relating to handling of orders 90,000
5,80,000
You are required to calculate the production overheads to be absorbed by
each unit of the products using the following costing methods:
i. A traditional coating approach, using a direct labour hour rate to
absorb overheads.
ii. An ABC approach, using suitable cost drivers to trace overheads to
products.
07
(b)
XYZ Ltd. manufactures toys. Fixed Cost amount to Rs. 2,70,000 per year.
Variable costs per toy are Rs. 23, and the average price per toy is Rs. 50.
(i) How many toys must XYZ Ltd. sell to break even?
(ii) If XYZ Ltd. sells 16,000 toys in a year, what is the operating income?
(iii) If XYZ Ltd. variable costs decreases to Rs. 20 per toy while the price and
fixed costs remain unchanged, what is the new break-even point?
07
OR
Q.4 The following records are available from the records of a manufacturing 14
Page 3 of 4
company for two level of activity:
Particulars 60% (Rs.) 100% (Rs.)
Direct Material 9000 15000
Direct wages 6000 10000
Indirect wages 3000 5000
Repair & Maintenance 6500 9500
Power & fuel 3750 5750
Rent 12000 12000
Depreciation 10000 10000
Insurance 6000 6000
Administrative overheads 10000 14000
Selling overheads 6000 8000
Total production at 100% capacity is 5000 units. Draw up Flexible Budget
at 70 % , 90% and 110% of normal capacity.
Q.5
CASE STUDY:
Rahul Ltd. is engaged in process engineering industry. During the month
of April, 2,000 units were introduced in Process A. The normal loss was
estimated at 5 % of input. At the end of the month, 1,400 units had been
produced and transferred to Process B, 460 units were incomplete. The
entire process had to be scrapped. The incomplete units had reached the
following stages of completion:
Materials 75 % completed
Labour 50 % completed
Overheads 50 % completed
Following are the additional information on Process A:
Cost of 2,000 units Rs. 58,000
Additional Direct Materials Rs. 14,400
Direct Labour Rs. 33,400
Direct Overheads Rs. 16,700
Units scrapped realized Rs. 10 each
You are required to prepare the following:
(i) Statement of Equivalent Production,
(ii) Statement of Cost per Equivalent Units,
(iii) Statement of Evaluation;
(iv) Process A Account, and
(v) Abnormal Loss/Gain Account.
14
OR
Q.5
CASE STUDY:
Vinayak Ltd. operating at 75% level of activity produces and sells two
products, A and B. The cost sheets of the two products are as under:
Particulars Product A Product B
Units produced and sold
Direct Materials
Direct Labour
Factory overheads (40% fixed)
Selling and administration
overheads (60% fixed)
Total cost per unit
Selling price per unit
600
Rs. 2
Rs. 4
Rs. 5
Rs. 8
Rs. 19
Rs. 23
400
Rs. 4
Rs. 4
Rs. 3
Rs. 5
Rs. 16
Rs. 19
Factory overheads are absorbed on the basis of machine-hours which is
Page 4 of 4
limiting factor. The machine hour rate is Rs. 2 per hour.
The company received an offer from the purchase of product A at a price
of Rs. 17.5 per unit. Alternatively, the company has another offer from the
Middle East for the purchase of product B at a price of Rs. 15.5 per unit.
In both the cases, a special packing charge of Rs. 0.50 per unit has to be
borne by the company.
The company can accept either of the two export orders by utilizing the
balance of 25% of its capacity.
You are required to prepare:
(i) A statement showing the economics of the two export proposals
giving your recommendations as to which proposals should be
accepted, and
(ii) A statement showing the overall profitability of the company after
incorporating the export proposals recommended by you.
07
07
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This post was last modified on 19 February 2020