GOVT.

FIRST GRADE COLLEGE, SHANKARNARAYAN

FIRST INTERNAL ASSESMENT EXAM AUGUST 2016

CLASS: III BBM TIME: 1 HOUR

SUBJECT: COST AND MANAGEMENT ACCOUNTING MARKS: 30

SECTION-A (10 MARKS EACH)

Answer any one from the following. (10X1=10)

1 .A lorry load of materials of mixed goods was purchased for Rs. 100000 by Mr kishor. Later on
these were sorted out in to the following categories:

Category A – 1000 units, selling price Rs.20 per unit.

Category B – 2000 units, selling price Rs.22.50 per unit

Category C – 2400 units, selling price Rs.25 per unit.

Find the purchase price per unit of each category of materials assuming that all grades yield same rate
of profit.

2. The following are taken from the costing records for the year 2014 of a manufacturer. Production ;
1000 units.
Cost of raw materials Rs. 20,000 Office overhead Rs. 4,000
Labour cost Rs. 12,000 Selling overhead Rs.1,000
Factory overhead Rs. 8,000

Rate of profit is 25% on selling price.

The manufacturer decides to produce 1500 units during 2015.
It is estimated that the cost of materials will increase by 20% and the labour cost will increase by
10%.
50% of overheads are fixed and other 50% are variable.
The variable selling overhead per unit will be reduced by 20%. The rate of profit will remain the
same. Prepare a statement for 2015 showing the total profit and the selling price per unit.

Section-B (20 Marks each)

Answer any one (20X1=20)

3. Sun Ltd manufacturing unit product is on the following information has been obtained for the year
ended 31/12/14

Stock On 01/01/2014 31/12/2014

Material (Rs.) 80,000 88,960

Finished goods (units) 2,000 4,000

W – I – P (Rs.) 19,200 64,000

 Rs.

Purchase of RM 4,80,000

Direct wages 4,00,000

Indirect material 24,000

Works manager salary 30,000

Works stationery 2,000

Indirect wages 4,000

Research and experiment 20,000

Employees state insurance 4,000

Other factory expanses 20,000

Consumable stores 2,000

Haulage 5,000

Drawing office expenses 2,000

Carriage inward 5,760

Printing and stationary 8,000

Office salary 48,000

Counting house salary 8,000

Samples and free gift 5,000

Upkeep of delivery van 5,000

Debt collection charges 5,000

Donation 15,000

Reserve for bad debts 3,000

Advance income tax 10,000

Sales 1,20,0000

Other selling expenses Rs.2.50 during the year 32000 units were produced and prepare a cost
sheet of 31/12/14.

4. what are the advantages and disadvantages of cost accounting?