M.Com. (Semester II) (CBCS) Examination Nov/Dec-2018
ADVANCED COSTING (Paper II)
Time: 2½ Hours Max. Marks: 70
Instructions: All questions are compulsory.
Use of calculator is allowed.
Figures to the right indicate full marks.
Q.1 Choose the alternatives given below. 14
Marginal Costing is a technique of
Management Financial
Cost Control All of the above
Which budget shows the anticipated sources and utilization of costs?
Sales Budget Capital Budget
Cash Budget Flexible Budget
Profit Volume Ratio shows the relationship between and Sales.
Stock Contribution
Purchase None of the Above
The document which described the budgeting organization procedures etc is
known as
Budget Center Key factor
Budget Manual None of the above
The Margin of safety may be improved by sales volume.
decreasing increasing
keeping constant none of the above
If production is nil, the loss will be equal to
Variable cost Fixed cost
Total cost Marginal cost
At break-even point, total cost is equal to
Total variable cost Total Revenue
Total sales volume None of the above
A flexible budget takes into account
Fixed costs only Variable and semi-variable cost only
Semi-variable costs only Fixed, variable and semi-variable costs
Margin of safety is
Actual sales BEP Sales Sales Fixed Cost
Sales Contribution Actual Sales Fixed Cost
10) P/V ratio is calculated by the following formula

F
S
X 100
C
S
X 100

S
C
X 100
S+V
S
X 100
11) is a device for controlling and co-ordinating the financial side of
business.
Cash Budget Flexible Budget
Master Budget Capital Budget
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12) Sales Ratio is
Fixed Cost plus profit Total Cost plus profit
Variable Cost plus profit Contribution plus profit
13) A budget is
an aid to management institute of management
a post mortem analysis none of the above
14) What is the formula of Break-even point in units?
a)Fixed Cost/P/V Ratio
b)Fixed Cost/Contribution per unit
c)Fixed Cost/Contribution per unit× Selling price per unit
d)Fixed Cost/1−Variable Cost per unit
Q.2 Write short notes on: 14
Classification of Reports
Types of Budgets
Q.3 Bombay Equipment manufactures four components, the cost structure of
which is given below:
07
Particulars
A
Rs.
B
Rs.
C
Rs.
D
Rs.
Direct material 80 100 100 120
Direct labour 20 25 25 30
Variable Overheads 10 12 15 10
Fixed Overheads 15 23 20 20
Total 125 160 160 180
Output per machine hour (unit)
4
2
3
3
T he key factor is machine capacity.
You are required to advise the management whether to make or buy them
from a supplier who quotes following prices:
A Rs.115, B Rs.175, C Rs.135 and D Rs.185
Given:
07
Sales Price Rs. 20 per unit
Variable manufacturing cost 11 per unit
Variable selling cost 3 per unit
Fixed factory overheads 5,40,000 per year
Fixed selling costs 2,52,000 per year
Calculate:
Break-even point
Sales required to earn a profit of Rs. 60,000
Sales required to earn a profit of Rs. 10% of sales
Q.4 Prepare cash budget of a company for April, May and June 2015 in a columnar
form using the following information:
14
Month
2015
Sales
Rs.
Purchases
Rs.
Wages
Rs.
Expenses
Rs.
January (Actual) 80,000 45,000 20,000 5,000
February (Actual) 80,000 40,000 18,000 6,000
March (Actual) 75,000 42,000 22,000 6,000
April (Budgeted) 90,000 50,000 24,000 7,000
May (Budgeted) 85,000 45,000 20,000 6,000
June (Budgeted) 80,000 35,000 18,000 5,000
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You are further informed that:
10% of the purchases and 20% of sales are for cash.
The average collection period of the company is ½ month and the credit
purchases are paid off regularly after one month.
Wages are paid half monthly and the rent of Rs. 500 included in expenses
is paid monthly.
Cash and Bank balance as on April, was Rs. 15,000 and the company
wants to keep the excess cash being put in fixed deposits.
OR
Q.4 You are given the following data: 14
Year Sales Profit
2010 1,20,000 8,000
2011 1,40,000 13,000
Find out
P/V ratio
Break-even point
Profit when sales are Rs. 1,80,000
Sales required to earn a profit of Rs. 12,000
Margin of safety in 2011
Q.5 From the following data for a 60% activity, prepare a budget for production at
80% and 100% capacity.
14
Production 600 units
Material cost Rs. 100 per unit
Direct Wages 40 per unit
Direct Expenses 10 per unit
Factory overheads 40,000 Fixed)
Administration Overheads 30,000 Fixed)
OR
Q.5 From the following find out 14
Sales Rs. 2,00,000
Marginal Cost Rs. 1,50,000
Fixed Cost Rs. 15,000
P/V Ratio
Break-even point
Net profit if the sales were Rs. 2,50,000
Sales to get a net profit of Rs. 70,000
Position of Rama and Company Ltd, for the year ending 31-12-2014.