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Question:
GOGO Manufacturing Company provides the following information on June 30,
2006.
Particulars Amount (Rs)
Sales for the year 2,50,000
Raw material inventory, July 1, 2005 10,000
Finished goods inventory, July 1, 2005 10,000
Purchases 1,50,000
Direct labor 20,000
Power, heat and light 2,500
Indirect material consumed 2,500
Administrative expenses 4,000
Depreciation of plant 3,000
Selling expenses 5,000
Indirect labor Costs 2,000
Other manufacturing expenses 1,000
Work in process, July 1, 2005 10,000
Work in process, June 30, 2006 20,000
Raw materials inventory, June 30, 2006 20,000
Finished goods inventory, June 30, 2006 20,000
Required:
1. Prepare cost of goods sold statement (Adjustment of over or under
applied FOH charge to entire production) & Income statement. (10)
2. Calculate gross margin & markup ratio. (5)
Q2. The Hedge Corporation manufactures only one product: planks. The single
raw material used in making planks is the dint. For each plank manufactured 12
dints are required. Assume that company manufactured 150,000 planks per year,
that demand for planks is perfectly stead throughout the year, that it cost Rs. 200
each time dints are ordered, and that carrying cost is Rs. 8 per dint per year.
b) What is the total inventory cost for Hedge (total carrying cost plus total
ordering cost)? Marks (3)
Required: Find out effective “rate of earnings under Rowan & Halsey-Weir
premium plan” Marks (2.5 x 2)
Question:
The information relating Kareem Corporation is as follow regarding
FOH:
Estimated Cost
Actual Cost
Calculate:
Question
JV Company began its operations on January 1, 19A and produces one product
that sells for Rs 7. Normal capacity is 100,000 units per year, with 100,000 units
produced and 80,000 units sold in 19A. Manufacturing costs and marketing and
administrative expenses were as follows:
Fixed Costs Variable Costs
Materials ---------- Rs 1.50 per unit produced
Direct labor ---------- 1.00 per unit produced
Factory overhead Rs 150,000 0.50 per unit produced
Marketing & admin expenses 80,000 0.50 per unit sold
Required:
1) Determine the 19A operating income, using direct / marginal costing and
absorption costing.
a. Break-even point where firms Revenue = Cost. Comment whether the cost
of Rs. 1, 77,050 will consider as a breakeven point?
b. Find the Break even point in number of students?
c. Find the Break even in Rupees?
d. Find the number of students that are required to earn a profit of Rs 25,000?
e. Find out margin of safety ratio?
The following information was taken from the books and records Ali
Manufacturing for the year ended 31st December, 2006.
Cost
Units (Rs.)
Sales during the year 8,000 ?
Opening Inventories:
Work in process - -
Finished goods 1,800 ?
Closing Inventories:
Work in process 100 ?
Finished goods 2,000 ?
Manufacturing Cost:
Direct Material 30,000
Direct Labor 20,000
Factory Overhead 16,000
Cost & Management Accounting (Mgt-402) Assignment-1
The foreman has submitted the following cost estimate for the closing work in
process Inventory:
The company’s past experience showed that factory overhead cost tends to
fluctuate closely in proportion to direct labor cost.
Required:
1. Determine the number of units that were manufactured during the year (1.5)
2. complete the foreman’s estimate of the cost of work in process (1.5)
3. Prepare a manufacturing statement for the year (3.5)
4. Determine the cost of each unit manufactured during the year (1.5)
5. Assume that the first cost recorded in the Finished goods account is the first
costs to be credited to the account. Determine the ending Inventory of
Finished goods and the Cost of Goods Sold. (2)
Cost & Management Accounting (Mgt-402) Assignment-1
QUESTION
The cost department of the Alpha Corporation prepared the following data and
costs for the year 19----:
Inventories:
January 01 December 31
(Rs.) (Rs.)
Finished Goods 48,600 ?
Work in process 81,500 42,350
Materials 34,200 49,300
Cost & Management Accounting (Mgt-402) Assignment-1
Required:
(1) The unit cost of the finished goods inventory, December 31
(2) The total cost of the finished goods inventory, December 31
(3) The cost of goods sold
(4) The gross profit total and the gross profit per unit
(5) Question# 01: (Marks: 10)
(6)
(7) Following is the receipts & issues record of Imran & Company for the
month of November, 2006.
(8)
Date Receipts Issues
November 07 200 units @ Rs. 150/unit --
November 09 -- 75 units
November 13 150 units @ Rs. 100/unit --
November 15 100 units @ Rs. 175/unit --
November 18 -- 250 units
November 20 100 units
November 22 300 units @ Rs.125/unit
November 24 -- 300 units
November 27 200 units @ Rs. 150/unit --
November 30 -- 125 units
(9)
(10)Required:
(11)
(12)Calculate the Value of closing stock by using Weighted Average Method of
stock valuation.
Cost & Management Accounting (Mgt-402) Assignment-1
(13)
(14)
(15)Question # 02 (Marks: 05)
The cost department of the Alpha Corporation prepared the following data and
costs for the year 19----:
Inventories:
January 01 December 31
(Rs.) (Rs.)
Finished Goods 48,600 ?
Work in process 81,500 42,350
Materials 34,200 49,300
Freight in 8,600
Miscellaneous factory overhead 47,900
Purchased discount 5,200
Required:
(1) The unit cost of the finished goods inventory, December 31
(2) The total cost of the finished goods inventory, December 31
(3) The cost of goods sold
The gross profit total and the gross profit per
Following is the receipts & issues record of Imran & Company for the month
of November, 2006.
Required:
The following information was taken from the books and records of the Zahid
Textile Mill for the year ended December, 2006.
The foreman has submitted the following cost estimate for the closing work in
process inventory:
Required:
Cost & Management Accounting (Mgt-402) Assignment-1
Calculate the value of Sales in Rupees from the data given above if Gross Profit is
45% of Cost of Goods Sold.
Complete the given Material Ledger cards prepared under LIFO & FIFO
according to the transactions given below:
Question 01
Kabul Company produces only one product. Normal capacity is 20,000 units
per year and the units’ sales price is Rs. 50. Relevant cost is:
Compute:
3. The number of units of product that must be produces and sold to achieve a
profit of Rs. 10,000
(Marks: 3+2+5)
Question 02:
You are required to show the profit statements for the month under:
(a) Absorption Costing
(b) Marginal Costing
Purchases:
Sales:
a. Each month’s Sales are billed on the last day of the month.
Cost & Management Accounting (Mgt-402) Assignment-1
REQUIRED:
Particulars Rs.
Sales for the year 480,000
Raw material inventory, July 1,2004 25,000
Finished goods inventory, July 1,2004 60,000
Purchases 100,000
Direct labor 65,000
Power, heat and light 2,500
Indirect material purchased and consumed 4,500
Cost & Management Accounting (Mgt-402) Assignment-1
Calculate:
1. Cost of raw-material consumed
2. Prime cost
3. Conversion Cost
4. Total factory cost
5. Cost of goods manufactured
Required:
(Marks: 5)
Question 02:
A B
Lead Time 4-8 days 3-5 days
Cost & Management Accounting (Mgt-402) Assignment-1
a) Order Level
b) Minimum level
c) Maximum level
d) Danger level
(Marks: 05)
Question 02
From the following data calculate the over/under absorption and show how the
transactions would be recorded in the production overhead account.
Departments
Cost Incurred by Departments A B C
(Rs.) (Rs.) (Rs.)
Material Cost 10,000 - -
Labor Cost 9,000 3,625 2,320
Factory Over Head Cost 4,500 2,175 1,740
Units Started in Process 1,000 - -
Units received from preceding department - 800 700
Units transferred to next department 800 700 -
Units transferred to finished goods store room - - 500
Units still in Process
Material 100%, Conversion Cost 75% 200 - -
Conversion cost 25% completed - 100 -
Conversion cost 40% completed - - 200
Required:
Prepare the Cost of production report for the month of June, 2006 for
Department A.
Note:
Please format the statement correctly. The allocation of the marks will be as
follows:
Statement Head 1
Quantity Schedule 2
Cost charged to the department (Total Cost and Unit Cost) 4
Cost accounted for as follows 5
Additional computation 3
Total 15
90 units of a product are sold for Rs. 100 per unit. Variable cost relating to
production and selling is Rs. 75 per unit and fixed cost is Rs. 2,250.
Required:
Prepare Income Statement and analyze under each of the following conditions:
Purchases:
Sales:
d. Each month’s Sales are billed on the last day of the month.
e. Customers are allowed a 3% discount if payment is made within 10 days
after the billing date. Receivables are recorded at Gross Selling Price.
f. 60% of the billings are collected within the discount period; 25% by the
end of the month; 9% by the end of second month and 6% prove
uncollectible.
REQUIRED: