End Session Examination - 2016-17

BBA – Sem I

Subject: Cost Accounting

Q.1: A) Explain the meaning, scope and importance of Cost Accounting

B) Explain in detail elements of coat

OR

C) A manufacturer produces one type of product and sold out @ Rs.40 per unit. He submits
you the following information. Prepare Statement of Cost from the following
details.
Particulars Amount
Stock on 1/10/2013 : Raw Materials 60,000
Work in Progress 30,000
Finished goods (7,000 units) 2,10,000
Raw materials purchased 4,85,000
Direct Wages 1,23,000
Indirect wages 12,000
Salary of factory inspector 12,300
Administrative expenses 62,000
Factory rent & taxes 8,550
Stock on 31/10/2013: Raw Materials 33,000
Work in Progress 12,600
Finished goods (2,000 units) 70,000
During the month production was of 20,000 units. Selling & Distribution expenses were
@Rs.3.10 per unit sold. Also calculate profit @ 25% on sales.

Q.2: A) Bharat Chemicals Ltd. manufactures & sells their chemicals produced by consecutive
processes. The products of these processes are dealt with as under:
Particulars Pro.1 Pro.2 Pro.3
Tr. to next process 66 2/3 % 60% -
Sent to ware house 33 1/3% 40% 100%
In each process 4% of the total weight put in is lost & 6% is scrap, which from process 1
realised Rs.3 per ton, from Process 2 Rs.5 per ton & from Pro.3 Rs.6/ton. The following
particulars relate to Jan. 2003.
Particulars Pro.1 Pro.2 Pro.3
Materials (tons) 1,400 160 1,260
Rate/ton 10 16 7
Wages & O/h 5,152 3,140 2,898
Prepare Process a/c’s.
B) The product of a manufacturing company passes through two processes A and B and then
to finished stock. It is ascertained that in each process 5% of the total weight put in is lost and
10% is scrap which from process A realizes Rs.20 per ton and Rs.30 per ton resp. The
process figures are as follows:
Particulars Process A Process B
Materials consumed (tones) 8,000 1,000
Cost of Materials per ton 30 50
Wages 20,000 10,000
Manufacturing Exp 15,000 5,000
Prepare Process cost accounts showing cost of output of each process.

OR
C) Product B is obtained after it passes through three distinct processes. The following
information is obtained from the accounts for the week ending on 31/3/2002.
Particulars Process A Process B Process C
Direct Material 2,600 1,980 2,962
Direct Wages 2,000 3,000 4000
Total production overheads amounted to Rs.9,000 to be allocated to three processes on
100% of wages. One thousand units @ Rs.Three were introduced to process I. The
following additional data are obtained.
Particulars Process A Process B Process C
Output in units 950 840 750
% of normal Loss 5% 10% 15%
Value of normal loss per unit 2 4 5
Prepare process A/c’s.

Q.3: A) Fast Roadways runs 10 buses between two suburban centres, which are 250 kms
apart. Seating capacity of each bus is 30 passengers. The exp. for the month of Nov. 2009
were as under:
Particulars Amount
Salaries of Drivers, & Conductors 60,000
Salaries of Mechanical staff 16,000
Diesel, oil, & lubricant 90,000
Taxes, Insurance 15,200
Repairs & Maintenance 18,000
Depreciation 32,000
Seating capacity utilised was 60%. Each bus makes one round trip daily. Find out cost
per passenger Km. & cost per round trip per passenger.

B) A transport service is running four buses between two towns, which are 350 kms apart.
Seating capacity of each bus is 40 passengers. The following particulars are obtained from
the records for the month of April 2010.
Particulars Amount
Wages of Drivers, Conductors, & cleaners 24,000
Salaries of office staff 20,000
Diesel, oil, & other oil 24,000
Repairs, & maintenance 1,800
Taxes, & Insurance 9,600
Depreciation 12,600
 Interest & other charges 20,000
The seating capacity utilised was 75%. All the four buses ran on all days of the
month. Each bus had made one round trip per daily. You are required to find out the cost per
passenger km.
OR
C) Mr. Jaika owns a fleet of taxies & the following information is available from records
maintained by him:
Particulars Amount
Number of taxies 10
Cost of each taxi 9,00,000
Salary of manager 8,000 pm
Salary of conductor 6,500 pm
Salary of cleaner 8,000 pm
Salary of mechanic 7,000 pm
Garage rent 5,000 pm
Insurance premium 5%
Annual tax 9,000/taxi
Driver’s salary 10,000/taxi
Annual repairs 5,000/taxi
Total life of taxi is 6,00,000 km. A taxi runs on an average 3,000 km in a month, of which
10% it runs empty. Diesel consumption is 10 km/lit @ Rs.65/lit. Oil & other sundries are
Rs.15/km. Calculate cost of running a taxi/km.

Q.4: A) Rahul & Co.’s sales in two successive years are 1,550 unit & 2,100 units & incurred
a loss of Rs.12,250 & earned a profit o fRs.10,850 resp. The selling price/unit is Rs.150.
Calculate: 1) BEP 2) Margin of Safety for second year 3) Number of units to be sold to earn a
profit of Rs.50,000 4) Amount of profit on sales of Rs.4,50,000.

B) From the following find out: 1) PV Ratio 2) BEP 3) Sales for 40% PV ratio 4) Margin of
Safety from the sales of Rs.3,00,000 5) Net profit from the sales of Rs.3,00,000 6) Required
sales for the net profit of Rs.70,000 7) Additional sales required to cover an increase of
Rs.3,000 pa in the sales manager’s salary. Given: Sales Rs.2,00,000, Fixed cost Rs.15,000,
Variable cost Rs.1,50,000.

OR
C) Raj Corporations Ltd. has prepared the following budget estimates for the year 2003 – 04.
Sales units 15,000 units, Fixed cost Rs.34,000, Sales value Rs.1,50,000, Variable cost
Rs.6/unit. You are required to calculate: 1) PV Ratio, BEP & Margin of Safety 2) Calculate
revised PV Ratio, BEP, & Margin of Safety in each of the following cases: A) Decrease of
10% in selling price 2) Increase of 10% in variable cost 3) Increase of sales volume by 2,000
units 4) Increase of Rs.6,000 in fixed cost.

Q.5: Write short notes on:

A) Advantages of Cost Accounting
B) Difference between Normal Loss and Abnormal Loss
C) Classification of Costs in Operating Costing
D) Concept of BEP