M.Com. (Semester (CBCS) Examination, 2017
ADVANCED COSTING (PAPER-I)
Day Date: Tuesday, 18-04-2017 Max. Marks: 70
Time: 02.30 PM to 05.00 PM
N.B. All questions are compulsory.
Figures to the right indicate full marks.
Use of calculator is allowed.
Q.1 Choose the alternatives given below. 14
The amount of expenditure (actual or national) incurred on or
attributable to specified thing or activity is called
Costing Cost accounting 1
Cost Development cost
is quantity for which order is placed when the stock
reaches re-order level.
Material control Maximum stock
Re-order quantity Material price
Normal rate of consumption X Leader time for emergency
purchase level.
Re-order Minimum
Danger Average
Bin Card is maintained by in the stores.
Cost accountant Cost management
Store keeper Auditor
both the quantity and value of materials
received, issued and in hand.
Bin card Store ledger
Cost sheet Costing Profit Loss A/c
In which method of pricing material, cost of closing stock
represents the cost of latest purchase?
LIFO FIFO
Simple Average Weighted Average
costing eliminates unhealthy competition.
Uniform Standard
Marginal Relevant
Page 1 of 4
SLR-Q- 3
Maximum stock level is 3600 kg and Average stock level is 2000
kg so that minimum stock level is
400 kg 5600 kg 4000 kg 1600 kg
is the aggregate of indirect material cost, indirect
labor cost and indirect expenses.
Overheads Fixed cost
Total cost Prime cost
10) those costs which do not vary with the change in
the volume of production up to a given range.
Variable overheads Fixed overheads
Total cost Indirect overheads
11) Use of uniform costing system creates markets.
Competitive Monopolistic
Foreign Local
12) of overheads is the process of charging the
proportion of common items of cost to two or more cost centers
on some equitable basis.
Allocation Classification
Apportionment Absorption
13) The practice of using same costing principles and or practice by
a number of firms in the same industry is called
Marginal costing Historical costing R
Cost accounting Uniform costing
14) Variable cost per unit remains
Constant Variable
Flexible None of the above
Q.2 Write short note on. 14
Fields covered by Uniform Costing.
Difference between Financial accounting and Cost accounting.
Q.3 Ltd. manufactures a special product ZED and provides the
following information.
Demand of ZED varies from 500 units to 1500 units per month
semiannual carrying cost 6%.
Ordering cost per order Rs. 90.
Raw Material required per unit of finished product 2kg.
Purchase price of input unit Rs. 25 per kg.
07
Calculate Economic order Quantity.
Page 2 of 4
SLR-Q- 3
From the following store transaction prepare store ledger using
Weighted Average method.
07
1-3-2016 Opening balance 2000 units value Rs. 20,000.
4-3-2016 Purchases 3000 units Rs. 12 per unit.
7-3-2016 Issues 4000 units.
10-3-2016 Purchases 4000 units Rs. 14 per unit.
19-3-2016 Issues 3000 units.
22-3-2016 Purchases 2000 units Rs. 16 per unit.
30-3-2016 Issues 3000 units.
Q.4 The company uses three raw materials B and C for a particular
product for which the following data is available.
14
Particulars
Raw
Material
A
Raw
Material
B
Raw
material
C
Wage per unit of product
10 04 06
Reorders quantity(kgs) 10,000 5,000 10,000
Price per 0.10 0.30 0.15
Minimum delivery period
(weeks) 1 3 2
Average delivery period
(weeks) 2 4 3
Maximum delivery period
(weeks) 3 5 4
Reorder level 8000 4750
Minimum level 2000
Weekly productions various from 175 to 225 units,
averaging 200 units of the said product. What would be the
following quantity-
Minimum Stock of Material A
Maximum Stock of Material B
Reorder level of material C
Average stock level of material A
OR
Calculate machine hour rate from the following. 14
Cost of machine Rs. 19,200.
Estimated scrap value Rs. 1,200.
Average repairs and maintenance charges per month Rs. 150.
Standing charges allocated to machine per month Rs. 50.
Effective working life of machine 10,000 hours.
Running time per month 166 hours.
Power used by machine 5 units per hour 19 paise per unit.
Page 3 of 4
SLR-Q- 3
Q.5 International Motors manufactures spare parts for Jeeps and Trucks.
They have furnished the following particulars for the quarter ended
31st March 2015.
14
Materials Rs. 2,98,000, Direct wages Rs. 42,000, Stores
Expenses Rs. 20,000, Machinery and Maintenance Rs. 4,600,
Deprecation Rs. 22,300, Staff Welfare Rs. 12,000, General
expenses Rs. 30,000, Administration and selling expenses Rs.
27,000.
Additional information provided by them.
Jeep Truck
Production (Nos.)
Material cost ratio per vehicle
Direct labor ratio
Machine hour ratio
300
121
400
232
Calculate cost per spare part of each vehicle indicating
basis of apportionment.
OR
Prepare store Ledger Account adopting FIFO and LIFO method
of pricing the issue of material.
14
August
2015
1579
19
24
27
Opening balance 50 units Rs. 3 per unit.
Issued 2 units to production.
Purchased 48 units Rs. 4 per unit.
Issued 20 units to production.
Purchased 76 units Rs. 3 per unit.
Received back in to store 19 units out of 20 units
issued on 9th August 2015.
Issued 10 units to production.