M.Com. (Semester (CBCS) Examination Mar/Apr-2018
ADVANCED COSTING (Paper
Time: 2½ Hours
Max. Marks: 70
Instructions: All questions are compulsory. Use of Calculator is allowed.
Q.1
Choose the alternatives given below.
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The use by several undertakings of the same costing principles and or practices is called
Absorption Costing
Cost accounting
Uniform costing
Store accounting
Total of indirect material cost, indirect wages and indirect expenses is
Total cost
Factory cost
Overheads
Fixed expenses
Cost accounting concepts include all of the following except
Planning
Controlling
Profit sharing
Product costing.
The formula for fixing level is reorder level (Normal consumption X Normal reorder period)
Maximum stock
Minimum stock
Re-order stock
Danger
In method stock is valued at the latest prices paid.
LIFO
FIFO
Simple average
Base stock
The allotment of whole items of cost to cost centres or cost units is called.
Cost absorption
Cost allocation
Cost apportionment
Cost classification
The amount of expenditure actual or notional incurred on or attributable to specified thing or activity is called
Cost
Cost accounting
Costing
Techniques of costing
those materials which can be conveniently identified with and can be directly allocated to a particular product, job or process.
Direct material
Indirect material
Direct labour
Indirect overheads
involves the planning, organizing and controlling the procurement, storage and usage of materials to achieve the objectives of efficiency and economy.
Material control
Material pricing
Issue of material
Material allocation
10) is the quantity for which order is placed when the stock reaches re-order level.
Purchase quantity
Danger quantity
Issue quantity
Re-order quantity
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11) When stock reaches an urgent action is required for fresh supplies of materials.
Minimum level
Re-order level
Dangle level
Maximum level
12) is the technique of evaluating the performance, efficiency, costs and profit of firms in an industry.
Cost control
Methods of pricing
Accounting of overhead
Inter firm comparison
13) of overheads is charging overheads from cost centers to products or services.
Departmentation
Fixation
Classification
Absorption
14) records both the quantity and value of materials received, issued and in hand.
Bin card
Cost sheet
Costing P L A/c
Store ledger
Q.2
Write short note on.
14
Uniform costing
Under and over absorption of overheads.
Q.3
Following information is available in respect of particular material.
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Reorder quantity
3600 units
Maximum consumption
900 units per week
Minimum consumption
300 units per week
Normal consumption
600 units per week
Reorder period
3 to 5 weeks
Calculate Reorder level minimum stock level and Maximum stock level.
Ram Ltd. manufactures a special product ZED and provides the following information.
Demand of ZED varies from 500 units to 1500 units per month
Semi Annual carrying cost
Ordering cost per order Rs.
Raw material required per unit of finished product 2 kg
Purchase price of input unit Rs. per kg.
Calculate Economic order quantity
Q.4
Compute machine hour rate of a wood working shop
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Purchase price of saw mill Rs.
Freight, other incidental and installation charges Rs.
Life of saw mill is 10 years 2,000 working hours per year
Repair charges 50% of depreciation
Consumption of electric power 10 units per hour 7 paise per unit
Lubricating oil Rs. per day of 8 hours
Consumable stores Rs. per day of 8 hours.
Wages for machine operator Rs. per day of 8 hours.
OR
Two components A and B are used as follows.
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Normal usage Maximum usage Minimum usage
300 units per week each 450 units per week each 150 units per week each
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A
B
Reorder quantity
2400 units
3600 units
Reorders period
4 to 6 weeks
2 to 4 weeks
Calculate for each component.
Reorder level
Minimum level
Maximum level
Average stock level
Q.5
Prepare store ledger account on the basis of simple average and weighted average method of pricing issues.
14
Receipts:
1-10-2016
Opening stock 200 units at Rs. 3.50/- per unit
3-10-2016
Purchased 300 units at Rs. per unit
13-10-2016
Purchased 900 units at Rs. 4.30/- per unit
23-10-2016
Purchased 600 units at Rs. 3.80/- per unit
Issues:
5-10-2016
Issued 400 units
15-10-2016
Issued 600 units
25-10-2016
Issued 600 units
OR
The New Enterprises Ltd. has production departments B and C and two service Departments D and E.
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The following figures are extracted from the records of the company.
Rent and Rates
Rs.5,000
General lighting
Rs.600
Indirect wages
Rs.1,500
Power
Rs.1,500
Depreciation of machinery
Rs.10,000
Sundries
Rs.10,000
The following further details are available.
Particular
Total
Production Department
Service Department
A
B
C
D
E
Floor space (sq.ft.)
10,000
2,000
2,500
3,000
2,000
500
Light points
60
10
15
20
10
5
Direct wages
10,000
3,000
2,000
3,000
1,500
500
H.P of Machine
150
60
30
50
10

Value of machinery
2,50,000
60,000
80,000
1,00,000
5,000
5,000
Working hours

6,226
4,028
4,066


The expenses of D and E are allocated as follows.
A
B
C
D
E
Dept D
20%
30%
40%

10%
Dept E
40%
20%
30%
10%

What is the total cost of an article if its raw materials cost is Rs. Labour cost Rs. and it passes through department B and C for 5 and 3 hours respectively.