State the benefits of value engineering. Briefly explain the importance of capital budgeting.
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Cost & Management Accounting
1. (i) Distinguish between
direct and indirect cost (ii) Explain the limitations of ratio analysis
2. State the benefits of value engineering.
3. Briefly explain the importance of capital
budgeting.
4. The following data relate
to the manufacture of a product during the month of January :
Raw materials consumed Rs. 80,000
Direct wages Rs. 48,000
Office overhead 10% of works cost
Units produced 4,000
Machine hours worked 8,000
Machine hour rate Rs. 4
Selling overhead Rs. 1.50 per unit
Units sold 3,600 at Rs. 50 each
Prepare a cost sheet.
5. Explain the concept of
margin of safety and angle of incidence in break-even analysis. Illustrate your
answer graphically
6. Sales 1,000 units at Rs. 10
each Rs. 10,000; Variable cost Rs. 6 per unit ; Fixed Cost Rs.
8,000.
(b) if the selling price is reduced to Rs. 9, what
is the new break even point?
7. The standard estimate
for materials to manufacture, 1,000 units of a commodity is 400 kgs.,
at Rs. 2.50 per kg.
When 2,000 units of the
commodity are manufactured, it is found that 820 kgs. of materials
are consumed at
Rs. 2.60 per kg. Calculate the material variance. Overhead 70%
Closing work-in progress: 1, 600 units.
8. Prepare a cash budget
for the three months ending 30th June, 2005 from the information
given below:
Month Sales Materials Wages Overheads
Rs. Rs. Rs. Rs.
February 14,000 9,600 3,000 1,700
March 15,000 9,000 3,000 1,900
April 16,000 9,200 3,200 2,000
May 17,000 10,000 3,600 2,200
June 18,000 10,400 4,000 2,300
(a) Credit terms :
Sales/Debtors – 10% sales are on cash, 50% of
the credit sales are collected next month and the balance in the following
month.
Creditors: Materials 2 Months
Wages Month
Overheads Month
(b) Cash and bank balance on 1st April 2005 is expected to be Rs. 6,000.
workshop is Rs. 6. The same part is available in
the market at Rs. 5.60 with an assurance of
continuous supply. The cost
data to make the part are: Material Rs. 2.00
Direct labour Rs. 2.50
Other variable costs Re. 0.50 Fixed cost allocated Re. 1.00 Total Rs. 6.00
(a) Should the part be made or bought?
(b) Will your answer be
different if the market price is Rs. 4.60? Show your calculations clearly.
10. The
following are the particulars applicable to a work process : Time rate Rs. 5
per hour
High task 40 units per week
Piece rate about high task Rs. 6.50 per unit
In a 40 hour
week, the production of the workers was : A - 35 unit; B - 40 units; C - 41
units and D - 52 units.
Calculate the wages of the workers under Gantt's
task bonus plan
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paper, contact
aravind.banakar@gmail.com
ARAVIND –
09901366442 – 09902787224
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