University Of Pune Question Paper
M.Com. (Semester – I) Examination, 2013
ADVANCED COST ACCOUNTING AND COST SYSTEMS (Group – B)
Special Paper – II
Costing Techniques and Responsibility Accounting
(2008 Pattern)
Time : 3 Hours Max. Marks : 100
Instructions: 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Use of calculator is allowed.
1. A) Fill in the blanks. 5
1) The principal budget factor for consumer goods manufacturer is normally
_______
2) Opening stock of material 13,000 kg, budgeted consumption during the
year 1,08,000 kg and estimated stock at the end of year 10,000 kg. Then
quantity of material to be purchased will be _______ kg.
3) Standard price of material per kg. Rs. 20, standard consumption per unit
of production is 5 kg; then standard material cost for producing 100 units
is Rs. _______
4) Uniform costing is the adoption of the same costing _______ and _______
by different units in the same industry.
5) A ________ centre is a segment of organisation for which both revenue
and costs are accumulated.
B) State whether the following statements are True or False : 5
1) Master Budget takes the form of profit and loss account and balancesheet
as at the end of the budget period.
2) Material cost variance is an aggregate of material price variance and
material usage variance.
3) Interfirm comparison is not beneficial to different firms in the industry.
4) An increase in production means an increase in the productivity.
5) Production budget will always show a constant quantity of output every
month.
C) Write short notes on (any two) : 10
1) Research and Development cost budget.
2) Procedure of establishing standard costs.
3) Application of uniform costing.
4) Requirements of an inter firm comparison.
2. What are the preliminaries for adoption of budgetary control system ? Describe
the objectives of budgetary control. 20
OR
2. Explain the concept of Responsibility Accounting. Describe various types of
Responsibility centres. 20
3. A) Following particulars are obtained from the books of Amar Engineers, Pune.
Particulars Quarter I Quarter II Quarter III Quarter IV
Rs. Rs. Rs. Rs.
Opening cash balance 10,000 – – –
Collection from 1,25,000 1,50,000 1,60,000 2,21,000
Customers
Payments
Purchase of material 20,000 35,000 35,000 54,200
Other expenses 25,000 20,000 20,000 17,000
Salary & Wages 90,000 95,000 95,000 1,09,000
Income Tax 5,000 – – –
Purchase of machinery – – – 20,000
-3- [4370] – 106
The firm desires to maintain a cash balance of Rs. 15,000 at the end of each
quarter. Cash can be borrowed or repaid in multiples of Rs. 500 at an interest
of 10% per annum. Management does not want to borrow cash more than
what is necessary and wants to repay as early as possible. In any event,
loans can not be extended beyond four quarters. Interest is computed and
paid when the principal is repaid. Assume that borrowing takes place at the
beginning and payments are made at the end of the quarters.
You are required to prepare a cash budget. 10
B) Explain the concept of uniform costing. State advantages of uniform costing. 10
4. The expenses for the production of 5000 units at 50% capacity in Andhra
Chemicals Ltd., Hyderabad are given as follows -
Particulars Unit cost (Rs.)
Material 50
Labour 20
Variable overheads 15
Fixed overheads (Rs. 50,000) 10
Administrative Expenses 10
(5% Variable)
Selling Expenses 06
(20% Fixed)
Distribution Expenses 05
(10% Fixed)
Total cost of sales 116
You are required to prepare a budget for 70% and 90% production capacity,
assuming that at 90% capacity, cost of material will increase by 10% whereas
labour cost will decrease by 5%. 20
[4370] – 106 -4-
5. In Global Engineers, Poladpur, the budgeted labour force employed in machine
shop is as follows –
Unskilled labour force :
200 workers @ Rs. 50 per hour for 40 hours.
Semi-skilled labour force :
300 workers at Rs. 60 per hour for 50 hours.
The actual labour force during a particular period was as follows -
Unskilled labour force :
210 workers @ Rs. 40 per hour for 45 hours.
Semi-skilled labour force :
290 workers @ Rs. 70 per hour for 45 hours.
You are required to compute :
a) Labour cost variance
b) Labour rate variance
c) Labour efficiency variance
for both unskilled and semi-skilled workers. 20
———–––––———
M.Com. (Semester – I) Examination, 2013
ADVANCED COST ACCOUNTING AND COST SYSTEMS (Group – B)
Special Paper – II
Costing Techniques and Responsibility Accounting
(2008 Pattern)
Time : 3 Hours Max. Marks : 100
Instructions: 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Use of calculator is allowed.
1. A) Fill in the blanks. 5
1) The principal budget factor for consumer goods manufacturer is normally
_______
2) Opening stock of material 13,000 kg, budgeted consumption during the
year 1,08,000 kg and estimated stock at the end of year 10,000 kg. Then
quantity of material to be purchased will be _______ kg.
3) Standard price of material per kg. Rs. 20, standard consumption per unit
of production is 5 kg; then standard material cost for producing 100 units
is Rs. _______
4) Uniform costing is the adoption of the same costing _______ and _______
by different units in the same industry.
5) A ________ centre is a segment of organisation for which both revenue
and costs are accumulated.
B) State whether the following statements are True or False : 5
1) Master Budget takes the form of profit and loss account and balancesheet
as at the end of the budget period.
2) Material cost variance is an aggregate of material price variance and
material usage variance.
3) Interfirm comparison is not beneficial to different firms in the industry.
4) An increase in production means an increase in the productivity.
5) Production budget will always show a constant quantity of output every
month.
C) Write short notes on (any two) : 10
1) Research and Development cost budget.
2) Procedure of establishing standard costs.
3) Application of uniform costing.
4) Requirements of an inter firm comparison.
2. What are the preliminaries for adoption of budgetary control system ? Describe
the objectives of budgetary control. 20
OR
2. Explain the concept of Responsibility Accounting. Describe various types of
Responsibility centres. 20
3. A) Following particulars are obtained from the books of Amar Engineers, Pune.
Particulars Quarter I Quarter II Quarter III Quarter IV
Rs. Rs. Rs. Rs.
Opening cash balance 10,000 – – –
Collection from 1,25,000 1,50,000 1,60,000 2,21,000
Customers
Payments
Purchase of material 20,000 35,000 35,000 54,200
Other expenses 25,000 20,000 20,000 17,000
Salary & Wages 90,000 95,000 95,000 1,09,000
Income Tax 5,000 – – –
Purchase of machinery – – – 20,000
-3- [4370] – 106
The firm desires to maintain a cash balance of Rs. 15,000 at the end of each
quarter. Cash can be borrowed or repaid in multiples of Rs. 500 at an interest
of 10% per annum. Management does not want to borrow cash more than
what is necessary and wants to repay as early as possible. In any event,
loans can not be extended beyond four quarters. Interest is computed and
paid when the principal is repaid. Assume that borrowing takes place at the
beginning and payments are made at the end of the quarters.
You are required to prepare a cash budget. 10
B) Explain the concept of uniform costing. State advantages of uniform costing. 10
4. The expenses for the production of 5000 units at 50% capacity in Andhra
Chemicals Ltd., Hyderabad are given as follows -
Particulars Unit cost (Rs.)
Material 50
Labour 20
Variable overheads 15
Fixed overheads (Rs. 50,000) 10
Administrative Expenses 10
(5% Variable)
Selling Expenses 06
(20% Fixed)
Distribution Expenses 05
(10% Fixed)
Total cost of sales 116
You are required to prepare a budget for 70% and 90% production capacity,
assuming that at 90% capacity, cost of material will increase by 10% whereas
labour cost will decrease by 5%. 20
[4370] – 106 -4-
5. In Global Engineers, Poladpur, the budgeted labour force employed in machine
shop is as follows –
Unskilled labour force :
200 workers @ Rs. 50 per hour for 40 hours.
Semi-skilled labour force :
300 workers at Rs. 60 per hour for 50 hours.
The actual labour force during a particular period was as follows -
Unskilled labour force :
210 workers @ Rs. 40 per hour for 45 hours.
Semi-skilled labour force :
290 workers @ Rs. 70 per hour for 45 hours.
You are required to compute :
a) Labour cost variance
b) Labour rate variance
c) Labour efficiency variance
for both unskilled and semi-skilled workers. 20
———–––––———
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