M.Com. (Semester IV) (CBCS) Examination Mar/Apr-2018
MANAGEMENT ACCOUNTING (Compulsory Paper III)
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.
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Make or buy decision can be facilitated with the help of analysis.
Ratio analysis
Marginal cost
Standard cost
Sales line
The variance is adverse when
Actual cost is higher than standard cost
Actual cost is more than budgeted cost
Standard cost is higher than actual cost
Actual cost is equal to standard cost
Margin of safety means
Break even sales less credit sales
Break even sales less cash sales
Break even sales less total sales
Total sales less Beak Even Sales
Which cost remains the constant per unit of output?
Fixed assets
Total cost
Marginal cost
Standard cost
All costs are included in marginal cost and all fixed cost are excluded.
Fixed
Total
Variable
Direct and indirect
In which form report can be presented to management.
Ratio and formula
Graphs
Statements, Charts and Tables
All of the above
is document which contains all aspects of budgeting and their administration.
Cost Sheet
Budget Manual
Budget Sheet
Marginal Cost Statement
blue print of the projected plan of action to be carried out during specific period in future.
Standard cost
Variance
Budget
Working capital
At Bank Even Point fixed cost is always equal to total
Profit
Contribution
Sales
Margin of safety
10) The variance arises due to difference between the number of working days in the Budgeted period and the number of actual working days.
Calendar
Labour efficiency
Labour rate
Material mix
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11) If fixed cost is Rs. 12,000, P/V ratio is sales is Rs. 80,000. What is the profit?
Rs. 40,000
Rs. 30,200
Rs. 20,000
Rs. 92,000
12) When ratio of variable cost to sales is 65% then the P/V ratio
35%
40%
25%
65%
13) A is formal communication, mostly written, which is generally moves upward.
Budget
Report
Product mix
Margin of safety
14) is an estimate of future needs arranged to an orderly basis covering some or all of the activities of an enterprise for some specific period in the future.
Standard cost
Variance
Budget
Working capital
Q.2
Write short notes on.
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Elements of MIS
Standard cost and Estimated cost
Q.3
Calculate Margin of Safety in each of the following cases.
07
Profit Rs. 24,000, P/V Ratio 60%
Break Even Sales Actual Sales Rs. 2,00,000
Profit Rs. 2,400, contribution per unit Rs. 6
Selling price per unit Rs. 10, variable cost per unit Rs. fixed cost Rs. 35,000. Calculate:
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New Break Even Point in each of the following cases.
If selling price is reduced by 20%
If variable cost is decreased by 25%
If fixed cost is increased by 20%
Q.4
From the following information prepare Cash Budget for the Month April to June 2017.
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Month
Credit sales
Materials
Wages
Overheads
February
6,00,000
4,00,000
80,000
60,000
March
7,50,000
5,00,000
1,00,000
70,000
April
9,00,000
6,00,000
1,20,000
80,000
May
10,50,000
7,00,000
1,40,000
90,000
June
12,00,000
8,00,000
1,60,000
1,00,000
Other information:
Cash sales are 1/4th of total sales.
½ of the credit sales are collected in the next month and balance are in the following month.
Lag in payment of wages is 1/4th month.
Materials are paid either on prompt or 30 days basis. It estimated that 10% of material purchases are on prompt basis.
Delay in payment of overheads ½ month.
Opening cash balance on 1st April 2017 is expected to be Rs. 2,50,000
OR
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Krushna Koyana Company working at 50% capacity manufactures 10,000 units of a product. At 50% capacity a product cost is Rs. 180 and sales price Rs. 200. The breakup of the cost is as below.
Cost per unit
Rs.
Material
100
Wages
30
Factory overheads
30(40% fixed)
Administration overheads
20(50% fixed)
At 60% working capacity raw material cost goes up by and sales price falls by 2%. At 80% working capacity raw material cost increase by and sales price decrease by same percentage i.e. 5%.
Prepare statement to show profitability at 60% and 80% capacity.
Q.5
Kamat Company is considering expansion. Fixed cost amount to Rs. 4,20,000 and are expected to increase by Rs. 1,25,000 when plant expansion is completed. The present plant capacity is 80,000 units a year. Capacity will increase by 50% with the expansion. Variable cost is currently Rs. 6.80 per unit and is expected to go down by Re. 0.40 per unit with expansion. The current selling price is Rs. 16 per unit and is expected to remain the same under either alternative. Which alternative is better and why?
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OR
With the help of following information calculate:
Labour cost variance
Labour rate variance
Labour efficiency variance
Standard hours: Rs. 4 per hour Actual hours: Rs. 3 per hour Standard time 40 hours Actual time 50 hours