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    Assignment AMA PDF

    Uploaded by

    Pritesh Ranjan Sahoo
    The document contains instructions for an assignment on advanced management accounting. It includes 4 questions related to cost analysis, break even analysis, byproduct costing, and labor variance analysis. The first question provides expenditure data for a textiles company and asks to calculate the open market price of cloth. The second question asks to calculate break even sales under different scenarios for a company making a loss. The third question asks to prepare a comparative profit and loss statement using reverse costing for a company with 3 products. The fourth question provides data on labor hours, wages, and output to calculate labor variances.

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    Assignment AMA PDF

    Uploaded by

    Pritesh Ranjan Sahoo
    90 views2 pages
    The document contains instructions for an assignment on advanced management accounting. It includes 4 questions related to cost analysis, break even analysis, byproduct costing, and labor variance analysis. The first question provides expenditure data for a textiles company and asks to calculate the open market price of cloth. The second question asks to calculate break even sales under different scenarios for a company making a loss. The third question asks to prepare a comparative profit and loss statement using reverse costing for a company with 3 products. The fourth question provides data on labor hours, wages, and output to calculate labor variances.

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    The document contains instructions for an assignment on advanced management accounting. It includes 4 questions related to cost analysis, break even analysis, byproduct costing, and labor variance analysis. The first question provides expenditure data for a textiles company and asks to calculate the open market price of cloth. The second question asks to calculate break even sales under different scenarios for a company making a loss. The third question asks to prepare a comparative profit and loss statement using reverse costing for a company with 3 products. The fourth question provides data on labor hours, wages, and output to calculate labor variances.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    90 views2 pages

    Assignment AMA PDF

    Uploaded by

    Pritesh Ranjan Sahoo
    The document contains instructions for an assignment on advanced management accounting. It includes 4 questions related to cost analysis, break even analysis, byproduct costing, and labor variance analysis. The first question provides expenditure data for a textiles company and asks to calculate the open market price of cloth. The second question asks to calculate break even sales under different scenarios for a company making a loss. The third question asks to prepare a comparative profit and loss statement using reverse costing for a company with 3 products. The fourth question provides data on labor hours, wages, and output to calculate labor variances.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Assignment

    Sub- Advanced Management Accounting


    Submission date- 11-11-2019, Maximum relaxation 13-11-2019

    1. The Government of India has instituted the dual pricing system in the industry in which
    your organisation operates. You are the head of the Costing Division of Raja Textiles Co.
    Ltd. Your company produces a standard type of cloth, 50% of which is procured by the
    Government at a price of Rs. 4 per metre. You are required by the Managing Director of
    your company to suggest a suitable price for the cloth to be sold in the open market.
    Production during 2005-06 has been 20,00,000 metres of cloth. Relevant information is
    given below :
    Expenditure Head Amount
    (in Rs.) Cotton Consumed 10,00,000
    Expenditure on Sales Depot 4,00,000
    Direct Labour in Factory 10,00,000
    Depreciation of Machines (Office) 1,00,000
    Carriage Inward 50,000
    Misc. Office Expenditure 1,00,000
    Indirect Labour in Factory 4,00,000
    Purchase of Computer for Office 2,00,000
    Salary of Works Director and Other Staff in Factory 2,50,000
    Misc. Purchases of Furniture and Machines for Office 5,00,000
    Water, Power, Local Taxes (Factory) 5,00,000
    Dividends paid 12,00,000
    Dyeing, Bleaching, etc. 10,00,000
    Directors' Fees 2,00,000
    Depreciation (Factory) 2,00,000
    Advertising and Publicity 10,00,000
    Excise and other Taxes on Production 30,00,000
    Commission paid on Sales 10,00,000
    Misc. Expenses (Factory) 1,00,000
    Commission paid to Foreign Office Salaries 10,00,000
    Buyers 1,00,000
    Salary of Managing Director 1,00,000
    Packing and Forwarding (on Sales) 2,00,000
    Following further information is made available :
    (i) The company expects a fair return of 20% on its paid-up capital which is Rs.
    1,00,00,000.
    (ii) Marketing Expenses outstanding are Rs. 1,00,000.
    Suggest the open market price after preparing a Cost Analysis Sheet in columnar form.
    Ans. (Rs. 9.80 per metre)

    2. A company is making a loss of Rs. 40,000 and relevant information is as follows


    Sales Rs. 1,20,000; Variable Costs Rs. 60,000; Fixed costs Rs. 1,00,000. Loss can be made
    good either by increasing the sales price or by increasing sales volume. What are Break
    even sales if
    (a) present sales level is maintained and the selling price is increased.
    (b) if present selling price is maintained and the sales volume is increased. What would be
    sales if a profit of Rs. 1,00,000 is required ?

    3. In manufacturing the main product A a Company processes the resulting waste material
    into two by-products, B1 and B2. Using reverse cost method of byproducts, prepare a
    Comparative Profit and Loss Statement of the three products from the following data :
    (i) Total cost upto separation point was Rs. 68,000.
    А B1 B2
    (ii) Sales (all production 1,64,000 16,000 24,000
    (iii) Cost after separation 4,800 7,200
    (iv) Estimated net profit percentage to sale value 20% 30%
    (v) Estimated selling expenses as percentage of 20% 20% 20%
    sales value

    4. A gang of workers usually consists of 10 men. 5 women and 5 boys in a factory. They are
    paid at standard hourly rates of Rs. 1.25, Re. 0.80 and Re. 0.70 respectively. In a normal
    working week of 40 hours the gang is expected to produce 1,000 units of output. A In a
    certain week, the gang consisted of 13 men, 4 women and 3 boys. Actual wages were paid
    at the rates of Rs. 1.20. Re. 0.85 and Re. 0.65 respectively. Two hours per week were lost
    due to abnormal idle time and 960 units of output were produced. Calculate various labour
    variances.

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