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    In Such A Way As To Assist The Management in The Creation of Policy and in The Day-To-Day Operations of An Undertaking." Elucidate

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    Keran Varma
    1. The document provides instructions for a management accounting exam consisting of 6 questions worth 75 marks total. It can be answered open book and any 4 questions can be attempted. 2. Question 2 asks students to prepare an overhead distribution statement using the repeated distribution method to show total overhead costs for production departments after redistributing costs from service departments. Multiple accounts and cost figures are provided. 3. Question 3 requires preparing a cash budget for 5 months showing cash inflows and outflows. Information on sales, materials, wages, overheads and payment terms is given to calculate the budget. [END SUMMARY]

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    In Such A Way As To Assist The Management in The Creation of Policy and in The Day-To-Day Operations of An Undertaking." Elucidate

    Uploaded by

    Keran Varma
    62 views4 pages
    1. The document provides instructions for a management accounting exam consisting of 6 questions worth 75 marks total. It can be answered open book and any 4 questions can be attempted. 2. Question 2 asks students to prepare an overhead distribution statement using the repeated distribution method to show total overhead costs for production departments after redistributing costs from service departments. Multiple accounts and cost figures are provided. 3. Question 3 requires preparing a cash budget for 5 months showing cash inflows and outflows. Information on sales, materials, wages, overheads and payment terms is given to calculate the budget. [END SUMMARY]

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    1. The document provides instructions for a management accounting exam consisting of 6 questions worth 75 marks total. It can be answered open book and any 4 questions can be attempted. 2. Question 2 asks students to prepare an overhead distribution statement using the repeated distribution method to show total overhead costs for production departments after redistributing costs from service departments. Multiple accounts and cost figures are provided. 3. Question 3 requires preparing a cash budget for 5 months showing cash inflows and outflows. Information on sales, materials, wages, overheads and payment terms is given to calculate the budget. [END SUMMARY]

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    62 views4 pages

    In Such A Way As To Assist The Management in The Creation of Policy and in The Day-To-Day Operations of An Undertaking." Elucidate

    Uploaded by

    Keran Varma
    1. The document provides instructions for a management accounting exam consisting of 6 questions worth 75 marks total. It can be answered open book and any 4 questions can be attempted. 2. Question 2 asks students to prepare an overhead distribution statement using the repeated distribution method to show total overhead costs for production departments after redistributing costs from service departments. Multiple accounts and cost figures are provided. 3. Question 3 requires preparing a cash budget for 5 months showing cash inflows and outflows. Information on sales, materials, wages, overheads and payment terms is given to calculate the budget. [END SUMMARY]

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    SET A

    Unique Paper Code : 61011306


    Name of Paper : Management Accounting
    Name of Course : Bachelor of Management Studies (BMS) CBCS
    Semester/ Annual : III
    Duration : 3 hours
    Maximum Marks : 75
    Instructions for Candidates:

    1. It is an open book examination.


    2. Attempt any four Questions. Allquestion carry equal marks..
    3. Use of simple calculator is allowed.

    1. “Management Accountant collects, analyzes and presents the accounting and other
    information in such a way as to assist the management in the creation of policy and in the
    day-to-day operations of an undertaking.” Elucidate.

    2.The following account balances and distribution of indirect charges are taken from the accounts
    of a manufacturing concern for the year ending on 31st March, 2020.

    Item Total Amount Production Departments Service Departments

    (Rs.) A (Rs.) B (Rs.) C (Rs.) X(Rs.) Y(Rs.)


    Indirect Material 1,20,000 20,000 30,000 40,000 20,000 10,000

    Indirect Labour 2,40,000 40,000 50,000 80,000 40,000 30,000


    Superintendent Salary 80,000 – – 80,000 – –

    Power 1,80,000
    Rent & Rates 75,,000

    Insurance 36,000

    Meal Charges 60,000


    Depreciation 3,60,000

    The following department data are also available:


    Item Production Departments Service Departments

    A B C X Y
    Area (Sq.ft) 4,400 4,000 3,000 2,400 1,200

    Capital Value of Assets 4,00,000 6,00,000 5,00,000 1,00,000 2,00,000


    (Rs.)
    Kilowatt Hours 3,500 4,000 3,000 1,500 –
    No. of Employees 60 70 120 30 20

    Expenses charged to the service department are to be distributed to other departments in the
    following percentages:

    A B C X Y
    Department X 30 30 20 – 20

    Department Y 25 40 25 10 –

    Prepare on overhead distribution statement by using repeated distribution method to show the
    total overheads of production departments after re-apportioning service departments overhead.
    Show all the calculations to the nearest rupee.

    3. XYZ Ltd. has given the following particulars. You are required to prepare a cash budget for
    quarters ending 31st December, 2020.
    Month Sales Materials Wages Overheads
    August 40,000 20,400 7,600 3,800
    September 42,000 20,000 7,600 4,200
    October 46,000 19,600 8,000 4,600
    November 50,000 20,000 8,400 4,800
    December 60,000 21,600 9,000 5,000

    Credit Terms are:


    (i) Sales/debtors – 10% sales are on cash basis. 50% of the credit sales are collected next
    month and the balance in the following month.
    (ii) Creditors – materials 2 months, wages 1/5 month, overheads 1/2 month.
    (iii) Cash balance on 1st October, 2020 is expected to be Rs. 8,000.
    (iv) A machinery will be installed in August, 2020 at a cost of Rs. 1,00,000. The monthly
    installment of Rs. 5,000 is payable from October onwards.
    (v) Dividend at 10% on preference share capital ofRs. 3,00,000 will be paid on 1st
    December, 2020
    (vi)Advance to be received for sale of vehicle Rs. 20,000 in December.
    (vii) Income-tax (advance) to be paid in December Rs. 5,000.

    4. ABC Limited produces a single product and standard costing system is followed in the
    organization.Following information is available from the cost records of the company for
    the month of October 2020:

    Material purchased 36,000 kg. Rs. 2,88,000

    Material consumed 34,200 kg ----------

    Actual wages paid for 7,750 hours Rs. 50,375

    Units produced 2,850 ----------

    Standard data are as follows:


    Direct Materials: 10 kg. per unit @ Rs.8.50 per kg.
    Direct wages: 2.5 hours per unit @ Rs.6 per hour

    You are required to calculate the following variances:


    (a) Material cost variance
    (b) Material Price variance
    (b) Material Usage variance
    (c) Labourcost variance
    (e) Labour rate variance
    (f) Labour efficiency variance

    5. SR Company Limited produces three grades of a product – super, good and normal. Each
    of these three grades of the productare high in demand and the company is able to sell
    whatever is produced.
    The machine operations which is part of overall process operations is a limiting factor. The
    company is operating at 100% capacity. The fixed cost is Rs.4,80,000. In addition, the Cost
    Accountant was able to extract the following information about the three grades of product.

    Product Super Good Normal


    Budgeted Production (units) 10,000 10,000 10,000
    Process hours per unit 10 10 8
    Machine hours per unit 6 5 4
    Selling price per unit (Rs.) 360 340 300
    Direct Materials cost per unit (Rs.) 200 180 150
    Direct Labour cost per process hour (Rs.) 7 7 5
    Variable Overheads per machine hours (Rs.) 5 10 12

    Required:
    (i) Determine the contribution margin per unitof each grade of product
    (ii) Present an analysis to management showing the relative profitability of three grades
    of product, assuming machine operations are the limiting factor.
    .

    6. SR Ltd. produces Product ‘Z’ through two distinct processes - Process I and Process II. On
    completion, it is transferred to finished stock. Following information is given for a particular
    month:

    Particulars Process I Process II


    Raw material used 7,500 units ---
    Raw material cost per unit Rs.60 ---
    Transfer to next process/finished stock 7050 units 6570 units
    Normal Loss ( on input) 5% 10%
    Direct Wages Rs.1,40,000 Rs.1,20,000
    Direct Expenses 60% of direct Wages 65 % of direct Wages
    Manufacturing Overheads 20% of direct Wages Rs. 34,650
    Realizable value of scrap per unit Rs.29 Rs.40

    There was no opening or closing stock of work in progress. You are required to:
    (i) Prepare process accounts, normal wastage account, abnormal wastage account and abnormal
    gain account if there is abnormal gain.
    (ii) 6,000 units of finished stock were sold at a profit of 20% on cost. Find the selling price.
    .
    -------------------------------------------------------------------------------------------------

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