• Embed Doc
  • Copy Link
  • Readcast
  • Collections
  • 3
    CommentGo Back
Download
 
The Institute of Chartered Accountants of PakistanFoundation and Modular Examinations Autumn 2001September 08, 2001COST ACCOUNTING (MARKS 100)FE-2 (PAPER-5) & MODULAR (PAPER D12) ‘D’ (3 hours)
Q.1(a) Place each of the following expenses of a manufacturing concern within the classificationof Production, Administration and Selling and Distribution:(i) Cost of oil used to lubricate fork lifter employed in finished goods warehouse.(ii) Salary of security guards posted at cash counter located in the Karachi factory.(iii) Commission paid to sales representatives.(iv) Commission paid to company’s purchasing agent.(v) Auditors’ fee(vi) Cost of damaged raw materials.(vii) Insurance expenses on finished goods(viii) Cost of packing cartons.(ix) Cost of protective clothing for machine operators.(x) Cost of stationery used in the Lahore factory.
(05)
 (b) Classify the following cost as fixed, variable and semi-variable:(i) Depreciation calculated on straight line method.(ii) Royalty expense(iii) Factory insurance(iv) Supervision and inspection(v) Industrial relations and employees’ welfare expenses(vi) Property tax(vii) Overtime costs(viii) Material handling costs(ix) Machinery repairs charges(x) Generator fuel costs.
(05)
 Q.2 The following information is available for the month of December 2000 of KhalidEnterprises:Accounts payable December 01, Rs 6,000Work in process December 01, Rs 30,000Finished goods December 01, Rs 50,000Material December 31, Rs 15,000Accounts payable December 31, Rs 10,000Finished goods December 31, Rs 60,000Actual factory overhead Rs 150,000Cost of goods sold Rs 300,000Payment of accounts payable usedonly for material purchases Rs 35,000Factory overhead is applied at 200% of direct labour cost. Jobs still in process on December31, have been charged Rs 6,000 for material and Rs 12,000 for direct labour hours (1,200hours). Actual direct labour hours 10,000 @ Rs 8.00 per hour.
FOR FREE ACCA, CA, CAT & CIMA RESOURCES VISIT: http://kaka-pakistani.blogspot.com
 
(02)
Required :
a) Material purchasedb) Cost of goods manufacturedc) Applied factory overheadd) Work in process December 31,e) Material usedf) Material as on December 01g) Over or under applied factory overhead.
(14)
Q.3 Emerson efficiency plan establishes a scale of bonus ratio between low task and high task starting with zero bonus at a certain efficiency level increasing by small increments tosuccessively large increments cumulating to a determined bonus at 100% efficiency. Above100% efficiency, additional bonus is allowed. Khaskhkaily Enterprises adopted theEmerson efficiency plan for their cigarette packing plant which employs four (4) workers.Bonus is paid to workers in addition to basic pay which is fixed by the labour authorities.Brief synopsis of the scheme is as follows:Efficiency rates Rates of BonusUpto 75% efficiency 0 Bonus76% to 85% efficiency 2.5% bonus86% to 98% efficiency 7.5% bonus99% and above efficiency 15% bonusStandard time 3 minutes per cartonMinimum Basic pay is Rs 3,375Information specific for the month of August 2001 is as follows:Actual packing for the monthWorker A 3,750 CartonsWorker B 4,625 CartonsWorker C 4,250 CartonsWorker D 3,350 CartonsAugust 2001 consisted of 25 working days of 9 hours each and there were no absenteesduring the month. For the purpose of calculating standard per unit labour rate minimumefficiency is considered as normal packing.
Required:
Calculate the employee wise payroll cost for the month of August 2001separately showing the basic pay and bonus payable to each employee.
(15)
Q.4 A controller is interested in an analysis of the fixed and variable cost of electricity as relatedto direct labour hours. The following data has been accumulated.Months Electricity Cost Direct labour hoursRupeesJan 2000 15,480 297Feb 2000 16,670 350Mar 2000 14,050 241Apr 2000 15,340 280May 2000 16,000 274June 2000 16,000 266July 2000 16,130 285Aug 2000 16,350 301
Required
: The amount of fixed overhead and the variable cost using.
 
a) The high and low points method
(06)
 b) The method of least square.
(06)
 
FOR FREE ACCA, CA, CAT & CIMA RESOURCES VISIT: http://kaka-pakistani.blogspot.com
 
(03)Q.5 SS Construction Co. have under taken the construction of a fly over for Road DevelopmentAuthority. The value of the contract is Rs.12,500,000 subject to a retention of 20% untilone year after the certified completion of the contract and final approval of the authoritiessurveyor. The Company has given the Contract No SS/RDA/786 for reference. Thefollowing are the details as shown in the books of account of SS Construction Co. as onJune 30, 2001:Amount in RupeesLabour wages paid 4,050,000Material purchased directly 4,200,000Material issued from stores 812,000Plant maintenance 121,000Other expenses 601,000Material in hand 63,000Wages payable 78,000Other expenses payable 16,000Work not yet certified 165,000Work certified 11,000,000Cash received on account 8,800,000
Required
:
 
Prepare the Contract Account to show the position at June 30, 2001, retainingan adequate provision against possible losses before final acceptance of the contract
. (10)
 Q.6 Shabbir Associates manufactures 3 joint products - Exe, Wye and Zee. A by-product Bayeis also produced. During the month of November 2000 the joint cost for direct materials anddirect labour were Rs 80,000 and 120,000 respectively. Shabbir Associates have anestablished practice of absorbing overhead at 50% of direct cost. Production and salesrelated data for the month of November 2000 is as follows:Products Production Sales Sales ValueKgs Kgs Rupees per UnitExe 7,800 7,000 10.00Wye 11,700 11,000 10.00Zee 10,000 9,000 6.50Baye 10,000 10,000 2.60The sales value of by-product is deducted from the process cost before apportioning cost toeach joint product. Costs of common processing are apportioned between joint product onthe basis of sales value of production. Assume that there is no opening inventories.
Required:
 
Calculate profit for the month of November and analyze the profit
product-wise.
(10)
 
Q.7 New Vision Trading Company Limited is planning to arrange for a six monthly overdraftfacility with a bank. However, before finalization of any arrangement it wants to know theestimated requirements of cash. For this purpose it has hired you as consultant to make anestimate of the foreseeable cash requirements.The following is the basic data regarding various business cycles of the Company
 
I. Sales forecast for the six months are as under:Months RupeesJanuary 800,000February 950,000March 600,000April 900,000May 1,100,000June 600,000
FOR FREE ACCA, CA, CAT & CIMA RESOURCES VISIT: http://kaka-pakistani.blogspot.com
of 00

Leave a Comment

You must be to leave a comment.
Submit
Characters: ...
09 / 15 / 2010This doucment made it onto the Rising List!
03346551893

icap cost accounting

reply06 / 25 / 2010
You must be to leave a comment.
Submit
Characters: ...