M.Com. (Semester II) (CBCS) Examination Nov/Dec-2018
ADVANCED COSTING (Paper
Time: 2½ Hours Max. Marks: 70
Instructions: All questions are compulsory.
Figures to the right indicate full marks.
Use of calculator is allowed.
Q.1 Choose the alternatives given below. 14
Spare parts and components manufacturing industries, Drug Industries, Ready
made garments etc are uses method of costing for ascertaining the costs.
Standard Costing Batch Costing
Operating Costing Contract Costing
can be estimated in advance on the basis of past experience of the
industry.
Abnormal Loss Normal Loss
Revenue Loss Capital Loss
Value of work certified minus cash received is equal to
Notional Profit Retention Money
Contract Price Work Uncertified
Idle time X standard rate per hour is equal to variance.
Ideal time Idle time
Labour performance Overhead Volume
costing is the use of standard costs for purposes of planning, control
and correction by comparing actual cost with standard cost.
Standard Uniform
Service Marginal
Work done since certification of work means
Work uncertified Work certified
Contract price Retention money
If cost per passenger Km is Rs. 5 and profit is 50% on freight, the freight per
passenger Km is Rs.
10.00 2.50
5.00 12.50
In process costing actual loss is less than normal estimated loss then it is called
as
Abnormal Gain Abnormal Loss
By Product Joint Product
As safeguard against fluctuation of prices of Materials, Labour etc is
usually provided in the contract deed.
Escalation Clause Tender
Cost Plus Contract Quotations
10) Portion of basic raw material which is lost in processing, having no recovery value
is called
Defective Scrap
Waste Spoilage
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11) programmes lead to a reduction in per unit cost of goods and services
produced.
Cost Estimation Cost Ascertainment
Cost Reduction Cost Improvement
12) Power Failure, Strikes, Lock out are the examples of
Overtime Actual time
Idle time Standard time
13) A is the difference between the actual costs and standard costs.
Standard Cost Actual Cost
Variance Productivity
14) is the form of specific order costing which applies where work is
undertaken according to customer's specifications.
Operating Costing Process Costing
Standard Costing Job Costing
Q.2 Write short notes 14
Improvement of Productivity
Factors affecting pricing decisions
Q.3 Following information is available from Ganesh Engineering works in respect of
Job No. 101.
07
Materials Rs. 5,800
Wages Department A 100 hours Rs. 5 per hour
Department B 200 hours Rs. 3 per hour
Overheads for these two departments are estimated as follows.
Variable Overheads Department A Rs. 10,000 for 5,000 direct Labor hours
Department B Rs. 30,000 for 10,000 direct Labor hours
Fixed Overheads Estimated at Rs. 50,000 for 50,000 normal working hours.
Calculate cost of Job No. 101 and the price to be charged so as to give a profit of
20% on selling price.
Prepare Process Account from the following Information: 07
Input of raw materials 950 units Rs. 20 per unit
Direct Materials Rs. 3,960
Direct Wages Rs. 6,000
Production Overheads 100% of direct wages
Actual output of process 840 units
Normal loss 10%
Value of Scrap Per unit Rs. 8
Q.4 Answer the following. (Any one) 14
Using the following information calculate the labour variance:
Direct Wages Rs. 3,000
Standard Hours Produced 1600
Standard Rate Per Hour Rs. 1.50
Actual Hours paid 1500 hours, out of which hours not worked (Abnormal idle time)
are 50 hours.
OR 14
From the following data calculate:
Variable Overhead expenditure Variance
Fixed Overhead expenditure Variance
Total Overhead cost Variance
Capacity Variance
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Budgeted Actual
Output 15,000 units 16,000 units
Number of working days 25 28
Fixed Overheads Rs. 30,000 Rs. 30,500
Variable Overheads Rs. 45,000 Rs. 47,000
There was an increase of in capacity.
Q.5 Answer the following. (Any One) 14
At the end of the first year on 31st March 2009, in the books of ABC Construction
Ltd. The Bridge contract Account stands debited with the cost of Material issued,
Labour, Overheads expended and Plan issued and its stands credited with
materials at the site Rs. 25,000 Materials returned Rs. 15,000 and Plant at site Rs.
4,76,000 after charging depreciation at 15%. The material issued, labour,
overheads and Plant issued debited to the contract account are in the ratio of

75% of the contract had been certified by the contractee's architect as completed
at end of the year and 90% of the certified work value had been received in cash
Rs. 16,20,000. The accounts department inform that 2/3 of the profit on cash basis
credited to profit and loss account on the contract is Rs. 2,13,600.
Prepare the bridge contract account.
OR
The Union Transport Company has given a 20 Kilometer long route to run a bus.
The bus costs the company Rs. 1,00,000. It has been insured at per annum.
The annual road tax amounts to Rs. 2000. Garage rent is Rs.400 per month.
Annual repair is estimated to cost Rs. 2,360 and the bus is likely to last for five
years.
The salary of the driver and the conductor is Rs. 600 per month and Rs.
200 per month respectively in addition to 10% of takings as commission to be
shared equally by them. The manager's salary is Rs. 1400 per month and
stationery will cost Rs. 100 per month. Petrol and Oil will cost Rs. 50 per 100
Kilometers. The bus will make three round trips per day carrying on an average 40
passengers in each trip. Assuming 15% profit on taking and that the bus will run
on an average 25 days in a month.
Prepare operating cost statement on a full year basis and also calculate the
bus fare to be charged from each passenger per kilometer.