*SY-8152*

SY-8152 Seat No.__________

M. B. A. Sem. II Examination
April / May – 2006
(4208) : Accounting for Managers : Paper - II
(New Course)

Time : 3 Hours] [Total Marks : 70

Instruction : All questions carry equal marks.

1 “Cost may be classified in a variety of ways according to their

nature and information needs of management.”–Explain and
discuss the statement, illustrating with example of the classifications
required for different purposes.

2 The cost of sale of product A is made up as follows :

Rs. Rs.
Material used in Indirect expenses 1,000
manufacturing 60,000 Admi. expenses 1,500
Material used in primary Depreciation on office
packing 10,000 building & equip. 1,000
Material used in selling Depreciation on
the product 2,000 factory building 2,000
Material used in factory 1,000 Selling expenses 4,000
Material used in office 1,500 Freight on material
Direct labour 10,000 purchased 5,000
Labour required for Advertising 2,000
factory supervision 5,000
Direct expenses 2,000

All production is for sale, what should be selling price to obtain

a profit of 20% on selling price ?

OR
2 Define costing and discuss the objective and advanatages and also
state how it can assist the management accountant.

3 (a) What is job costing ? What are its main characteristics ?

(b) Define joint product and by product.

OR

SY–8152] 1 [ Contd....
3 Bata Shoe Ltd. sells fire types of chappals. Their expenses and
revenues are as follows :
Rs. (per pair)
Selling price 30.00
Variable cost 19.50
Salesmen's commission 1.50
Annual fixed expenses :
Rent 60,000
Salaries 2,00,000
Advertising 80,000
Other fixed exp. 20,000
Required :
(i) Calculate the annual BEP in units and in value.
(ii) Profit / loss on sales of 35,000 pairs.
(iii) A new plan is to discontinue sales commissions but a fixed
salaries of Rs. 90,000 is to be paid for that. A reduction in
selling price of 5% is also proposed. What will be BEP in
units.
(iv) It is proposed to pay the store manager 50 paise per pair
as further commission. Selling price is also proposed to be
increased by 5%, what would be the BEP units ?
(v) If the store manager were to be paid 30 paise commission
on each pair sold in excess of the break-even point what will
be net profit if 50,000 pairs were sold ?

4 (a) Explain normal wastage and abnormal wastage. How should

these dealt with in process accounts ?
(b) “Cost control and cost reduction” – Define the terms.

OR

4 Following details relate to product ‘K’ for the month of March-2006.

Compute material and labour cost variance.
Standard Cost per Unit.
Material 50 kgs @ Rs. 40 per kg.
Labour 400 hrs. @ Re. 1 per hr.
Actual cost for the month :
Material 4,900 kg @ Rs. 42 per kg.
Labour 39,600 hrs. @ Rs. 1.10 per hr.
Actual production - 100 units
SY–8152] 2 [ Contd....
5 A company is expecting to have Rs. 25,000 cash in hand on 1st
April and it requires you to prepare an estimate of cash position
during the three month, April to June - 2006. Following information
is supplied for the purpose.
Month Sales Purchases Wages Expenses
Rs. Rs. Rs. Rs.
February 70,000 40,000 8,000 6,000
March 80,000 50,000 8,000 7,000
April 92,000 52,000 9,000 7,000
May 1,00,000 60,000 10,000 8,000
June 1,20,000 55,000 12,000 9,000
Other Information :
(i) Period of credit allowed by suppliers - 2 month.
(ii) 25% of sales is for cash and period of credit allowed to
customers for credit sales one month.
(iii) Delay in payment of wages and expenses 1 month.
(iv) Income tax of Rs. 25,000 is to be paid in June-'06.

SY–8152] 3 [ 500 /14-8 ]