Download JNTUH (Jawaharlal Nehru Technological University Hyderabad) MBA (Master of Business Administration) 3rd Semester (Third Semester) R15 2018 July 723AG Strategic Management Accounting Previous Question Paper
Code No: 723AG
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
MBA III Semester Examinations, June/July-2018
STRATEGIC MANAGEMENT ACCOUNTING
Time: 3hours Max.Marks:75
Note: This question paper contains two parts A and B.
Part A is compulsory which carries 25 marks. Answer all questions in Part A.
Part B consists of 5 Units. Answer any one full question from each unit. Each question
carries 10 marks and may have a, b, c as sub questions.
PART - A 5 ? 5 Marks = 25
1.a) Give the breakup of a cost sheet with as many details as possible. [5]
b) What is the formula for computing the value of Abnormal loss in process costing? [5]
c) How do Managements make use of limiting factor of an input while taking output
Decisions? [5]
d) Represent Margin of safety graphically with necessary notations. [5]
e) How are Labour Mix sub variances computed? [5]
PART - B 5 ?10 Marks = 50
2. Explain in detail the role of a Management Accountant while taking strategic decisions
by the Top Management. [10]
OR
3. The following information is provided to you from costing records of a company: [10]
Lighting Rs.200 Supervision Rs.3,000
Rent 2,000 Insurance 1,000
Maintenance 1,200 Employer?s
contribution to PF
300
Depreciation 900 Energy 1,800
The following statement shows Department wise data during a period
A B C D
Floor space (Sq.ft.) 150 110 90 50
Total Direct wages (Rs.) 8,000 6,000 4,000 2,000
Cost of Machinery (Rs.) 24,000 18,000 12,000 6,000
No. of workers 24 16 12 8
Stock of goods 15,000 9,000 6,000 ---
Prepare a statement showing apportionment of cost to various departments.
R15
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Code No: 723AG
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
MBA III Semester Examinations, June/July-2018
STRATEGIC MANAGEMENT ACCOUNTING
Time: 3hours Max.Marks:75
Note: This question paper contains two parts A and B.
Part A is compulsory which carries 25 marks. Answer all questions in Part A.
Part B consists of 5 Units. Answer any one full question from each unit. Each question
carries 10 marks and may have a, b, c as sub questions.
PART - A 5 ? 5 Marks = 25
1.a) Give the breakup of a cost sheet with as many details as possible. [5]
b) What is the formula for computing the value of Abnormal loss in process costing? [5]
c) How do Managements make use of limiting factor of an input while taking output
Decisions? [5]
d) Represent Margin of safety graphically with necessary notations. [5]
e) How are Labour Mix sub variances computed? [5]
PART - B 5 ?10 Marks = 50
2. Explain in detail the role of a Management Accountant while taking strategic decisions
by the Top Management. [10]
OR
3. The following information is provided to you from costing records of a company: [10]
Lighting Rs.200 Supervision Rs.3,000
Rent 2,000 Insurance 1,000
Maintenance 1,200 Employer?s
contribution to PF
300
Depreciation 900 Energy 1,800
The following statement shows Department wise data during a period
A B C D
Floor space (Sq.ft.) 150 110 90 50
Total Direct wages (Rs.) 8,000 6,000 4,000 2,000
Cost of Machinery (Rs.) 24,000 18,000 12,000 6,000
No. of workers 24 16 12 8
Stock of goods 15,000 9,000 6,000 ---
Prepare a statement showing apportionment of cost to various departments.
R15
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4. A factory uses Job costing. The following cost data is obtained from its books for the
year ending 31
st
December, 2016.
Direct Materials Rs.90,000
Direct wages 75,000
Profit 60,900
Selling &Distribution overheads 52,500
Administration overheads 42,000
Factory overheads 45,000
(a) Prepare a job cost sheet indicating the prime cost, works cost, cost of production,
cost of sales and sales value.
(b) In 2017, the factory receives an order for a number of jobs. It is estimated that direct
materials required will be Rs.1,20,000 and direct labour will cost Rs.75,000. What
should be the price for the jobs if the factory intends to earn the same rate of profit on
sales assuming that the selling & distribution overheads have gone up by 15%? The
factory recovers factory overhead as a % of direct wages and administration and
distribution overhead as a % of works cost based on cost rates prevailing in the previous
year. [10]
OR
5. XYZ Ltd. is engaged in the process engineering industry. During the month of April,
2016, 2,000 units were introduced in Process X. 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
Y, 460 units were incomplete units and 140 units during the process had been scrapped.
The incomplete units had reached the following stages of completion:
Materials: 75% completed; Labour: 50% completed; Overhead: 50% completed.
Following is the further information on Process X:
Cost of 2,000 units Rs.58,000
Additional Direct material: Rs.14,400
Direct labour 33,400
Direct overhead 16,700
Units scrapped realized @ Rs.10 each.
Prepare a statement of equivalent production, statement of cost, statement of evaluation
and process X Account. [10]
6. A company can produce and sell at its maximum capacity 20,000 units of a product. The
sale price is Rs.100. The present sales are 15,000 units. To produce over 20,000 units
and upto another 10,000 units some balancing equipments are to be installed at a cost of
Rs.10, lakhs and the same will have a life span of 10 years.
The current cost structure is as under:
Direct Materials 30% of sale value
Direct labour 20% of sale value
Variable overheads Rs.20 per unit
Profit Rs.15 per unit
The present cost is estimated to go up due to price escalation as under:
10% in Direct material from present level of 30%
25% in Direct labour from present level of 20%
Rs.50,000 in Fixed overheads per year
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Code No: 723AG
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
MBA III Semester Examinations, June/July-2018
STRATEGIC MANAGEMENT ACCOUNTING
Time: 3hours Max.Marks:75
Note: This question paper contains two parts A and B.
Part A is compulsory which carries 25 marks. Answer all questions in Part A.
Part B consists of 5 Units. Answer any one full question from each unit. Each question
carries 10 marks and may have a, b, c as sub questions.
PART - A 5 ? 5 Marks = 25
1.a) Give the breakup of a cost sheet with as many details as possible. [5]
b) What is the formula for computing the value of Abnormal loss in process costing? [5]
c) How do Managements make use of limiting factor of an input while taking output
Decisions? [5]
d) Represent Margin of safety graphically with necessary notations. [5]
e) How are Labour Mix sub variances computed? [5]
PART - B 5 ?10 Marks = 50
2. Explain in detail the role of a Management Accountant while taking strategic decisions
by the Top Management. [10]
OR
3. The following information is provided to you from costing records of a company: [10]
Lighting Rs.200 Supervision Rs.3,000
Rent 2,000 Insurance 1,000
Maintenance 1,200 Employer?s
contribution to PF
300
Depreciation 900 Energy 1,800
The following statement shows Department wise data during a period
A B C D
Floor space (Sq.ft.) 150 110 90 50
Total Direct wages (Rs.) 8,000 6,000 4,000 2,000
Cost of Machinery (Rs.) 24,000 18,000 12,000 6,000
No. of workers 24 16 12 8
Stock of goods 15,000 9,000 6,000 ---
Prepare a statement showing apportionment of cost to various departments.
R15
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4. A factory uses Job costing. The following cost data is obtained from its books for the
year ending 31
st
December, 2016.
Direct Materials Rs.90,000
Direct wages 75,000
Profit 60,900
Selling &Distribution overheads 52,500
Administration overheads 42,000
Factory overheads 45,000
(a) Prepare a job cost sheet indicating the prime cost, works cost, cost of production,
cost of sales and sales value.
(b) In 2017, the factory receives an order for a number of jobs. It is estimated that direct
materials required will be Rs.1,20,000 and direct labour will cost Rs.75,000. What
should be the price for the jobs if the factory intends to earn the same rate of profit on
sales assuming that the selling & distribution overheads have gone up by 15%? The
factory recovers factory overhead as a % of direct wages and administration and
distribution overhead as a % of works cost based on cost rates prevailing in the previous
year. [10]
OR
5. XYZ Ltd. is engaged in the process engineering industry. During the month of April,
2016, 2,000 units were introduced in Process X. 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
Y, 460 units were incomplete units and 140 units during the process had been scrapped.
The incomplete units had reached the following stages of completion:
Materials: 75% completed; Labour: 50% completed; Overhead: 50% completed.
Following is the further information on Process X:
Cost of 2,000 units Rs.58,000
Additional Direct material: Rs.14,400
Direct labour 33,400
Direct overhead 16,700
Units scrapped realized @ Rs.10 each.
Prepare a statement of equivalent production, statement of cost, statement of evaluation
and process X Account. [10]
6. A company can produce and sell at its maximum capacity 20,000 units of a product. The
sale price is Rs.100. The present sales are 15,000 units. To produce over 20,000 units
and upto another 10,000 units some balancing equipments are to be installed at a cost of
Rs.10, lakhs and the same will have a life span of 10 years.
The current cost structure is as under:
Direct Materials 30% of sale value
Direct labour 20% of sale value
Variable overheads Rs.20 per unit
Profit Rs.15 per unit
The present cost is estimated to go up due to price escalation as under:
10% in Direct material from present level of 30%
25% in Direct labour from present level of 20%
Rs.50,000 in Fixed overheads per year
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There is a concrete proposal from a party to take 10,000 units additionally over present
level of output on a long term basis at a unit price of Rs.90. Apart from the investment
of Rs.10 Lakhs as shown above, the fixed overheads will increase by Rs.50,000 due to
additional Administrative expenses.
The Co. is in a dilemma as to whether to accept the order for 10,000 units or to use the
present un capacity of 5,000 units for which there will be additional selling
expenses of Rs.50,000. Ignore financial charges and give your recommendation. [10]
OR
7. A businessman produces and sells 95,000 units of a product in a year at its 80%
production capacity. The selling price of the product is Rs.8 per unit. The variable cost is
75% of selling price per unit. The fixed cost is Rs.3,50,000. The company is
continuously incurring losses and the management plans to shut down the plant. The
fixed cost is expected to be reduced to Rs.1,30,000. Additional costs of plant shutdown
are expected at Rs.15,000.
Should the plant be shut down? What is the capacity level of production of shutdown
point? [10]
8.a) What are the limitations of Breakeven Analysis?
b) X Co. Ltd. has an overall P/V ratio of 40%. The marginal cost of a product is estimated
to be Rs.30. Determine the selling price. [4+6]
OR
9. What are the basic requirements needed for conducting inter firm comparison? Elaborate
various types of comparisons. [10]
10. Prepare cash budget of a business unit for April to June, 2017 from the following
information and ascertain the opening balance as on 1
st
July,2017.
a) Estimated sales, purchases and expenses are as follows:
Jan (Rs.) Feb (Rs.) March
(Rs.)
April (Rs.) May (Rs.) June (Rs.)
Sales 2,00,000 4,00,000 6,00,000 8,00,000 10,00,000 12,00,000
Purchases 1,52,000 3,06,000 4,60,000 6.08,000 7,56,000 9,04,000
Wages 24,000 30,000 36,000 48,000 60,000 72,000
Admn.
expenses
30,000 40,000 50,000 60,000 70,000 80,000
Selling &
Distribution
expenses
30,000 50,000 70,000 90,000 1,10,000 1,00,000
b) Cash sales are 20% of total sales
c) 50% of credit sales are collected within one month and the balance in two months
d) Cash purchases are 25% of total purchases
e) 50% of credit purchases are paid within one month and the balance in two months.
f) No stock remains at the end of a month.
g) Commission on sales 10%
h) Cash balance at the end of March. Rs.4,00,000 [10]
OR
11. What is Variance Analysis? Explain and illustrate the various types of material
variances. What are the difficulties in setting up standards? [10]
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This post was last modified on 23 October 2020