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Adl 56 Cost Managerial Accounting Assignment PDF
Adl 56 Cost Managerial Accounting Assignment PDF
Uttar Pradesh
India 201303
ASSIGNMENTS
PROGRAM: ADL 56
Cost and Managerial Accounting
Subject Name :
Permanent Enrollment Number ( PEN) :
Roll Number (SEN.No.) :
Student Name :
INSTRUCTIONS
a) Students are required to submit all three assignment sets.
Signature : _________________________________
Date : _________________________________
Q1 Q1 ZEE is product, manufactured out of three raw materials M,N, & Q. Each unit of ZEE
requires 10 kg, 8 kg, & 6 kg of M,N,Q, respectively. The reorder levels of M, & N are 15000 &
10,000 kg respectively., while the minimum level of Q is 2500 kg. The weekly production of
ZEE varies from 300 to 500 units, while the weekly average production is 400 units. You are
required to compute:-
1. The minimum stock level of M
2. The maximum stock level of N
3. the reorder level of Q
Additional Information:-
Re-order quantity (kg) M N Q
20000 15000 20000
Delivery time (in weeks)
Minimum 2 4 3
Average 3 5 4
maximum 4 6 5
Q2 M/s Cotton Mills Ltd. Take a periodic inventory of their stocks on chemical Y at the end of
each month, The physical inventory taken on June 30th shows a balance of 1,000 litres of
chemical Y in hand@Rs.2.28litre.
Q4 State whether the following statements are true or false. Give reasons.
Q5 P Ltd. Manufactures two products using one type of material. Shown below is an extract
from the companys papers for the next period budget.
Product A Product B
Budgeted Sales(In units) 3,600 4,800
Budgeted material consumption per product(kg) 5 3
Assignment B
Q1 Comment on the relative profitability of the following products when there is a) no key
factor. b) Machine Hrs are limited(Key factor)
Alpha Beta
Rs. Rs.
Selling price 100 150
Material 25 30
Wages 5 10
Machine hr rate:
Variable 2 3
Fixed 1 1
Variable overhead 15 20
Fixed Expenses 2 2
Machine hrs.used 10 15
Production 300Units 250Units
(b) Determine the amount of fixed expenses from the following particulars:
Sales Rs.2,40,000, Direct Material Rs. 80,000, Direct Labour Rs.50,000, variable
overheads Rs. 20, 000, Profit Rs. 50,000
Q4 A product passes through two distinct process A & B & thereafter it is transferred to finished
stock. From the following information you are required to prepare Process Accounts:
Process A Process B
Rs Rs
Material consumed 24000 12000
Wages 28000 16000
Manufacturing expenses` 8000 8000
Input in Process A (units) 20,000 ----
Input in process A (value in Rs) 20000 -----
Output (units) 31th Dec 2003 18,800 16,600
Normal wastage percentage of input 5% 10%
Value of normal wastage (per 100 units) 8 10
Assignment C
Q1 Which of the following statements is/are true?
a) Cost accounting is not a part of management accounting.
b) Cost accounting is a system to record, summarize and report cost information.
c) Cost accounting is a post mortem of past costs.
d) Cost accounting is not necessary if financial accounting provides necessary analysis.
Q3 Costing Technique in which all costs, variable as well as fixed, are charged to product,
operations or services is
(a) Historical costing
(b) Absorption costing
(c) Marginal costing
(d) Direct costing
Q4 The costing approach wherein actual costs are ascertained after they have been incurred is
(a) Marginal costing
(b) Direct costing
(c) Standard costing
(d) Historical costing
Q5 The cost which reflects the policies of the top management which result in periodic
appropriations are called as
(a) Future cost
(b) Discretionary cost
(c) Committed cost
(d) Programmed cost
Q6 In a given situation if a product is not produced the company can save on the salary of
workers to the tune of Rs.1,00,000. In this case the salary of the worker is
(a) Imputed cost
(b) Unavoidable cost
(c) Avoidable cost
(d) None of the above
Q8 Costs that are not relevant for decision-making and are not affected by increase or decrease in
volume are
(a) Out of pocket cost
(b) Sunk cost
(c) Differential cost
(d) Imputed cost
(a) The part of the business where all costs are paid to suppliers
(b) A production department where all production costs are aggregated
(c) An area of the business accountable for both costs and revenues
(d) An area for which costs are accumulated
12. An investment centre is a responsibility centre where the manager has control of:
(a) The total costs of operating the production department where the product is made
(b) The total direct costs of manufacturing a product
(c) The total costs of manufacturing a product
(d) The cost of the first stage of the manufacture of a product
Using the first-in, first-out (FIFO) method of stock valuation the cost of sales is:
(a) 470
(b) 510
(c) 1,020
(d) 120
17. A business has bought and sold identical items of stock during 2006 as follows:
Using the first-in, first-out (FIFO) method what is the value of the 800 units of stock left unsold at
31/12/06?
(a) 10,400
(b) 8,000
(c) 16,000
(d) 12,800
18. The weighted average method of stock valuation would be most appropriate for:
(a) Total direct labour hours at the normal hourly rate of pay
(b) All labour costs attributable to a product
(c) Direct labour costs plus any bonuses
(d) Direct labour costs plus any bonuses and overtime premiums
(a) Overheads
(b) Direct labour
(c) Total costs
(d) Prime costs
24. Which of the following would be an inappropriate method of apportioning service department
costs?
25. Which of the following is an unsatisfactory method of dealing with reciprocal service costs?
26. The most appropriate method of apportioning the rent of a building would be:
(a) Absorbing the direct costs of production and service departments into products
(b) Absorbing direct costs of production into products
(c) Absorbing only production service cost centre costs into product costs
(d) Absorbing both production and non-production service cost centre costs into product costs
28. Which of the following would not normally be a suitable method of absorbing costs into products
i. Machining Assembly
ii. Total cost centre overhead 120,000 180,000
iii. Machine hours 15,000 9,000
iv. Labour hours 2,000 8,000
The most appropriate overhead rate to use for the machining department would be:
30. The following details were extracted from the cost records of a company:
If it cost 3,500 to insure the buildings, the amount that would be apportioned to the assembly
department would be:
(a) 1,479
(b) 72
(c) 1,896
(d) 372
(a) Overhead absorption rates will normally be based on estimates of what costs are expected to be
(b) Once set, overhead absorption rates will not change from one year to the next
(c) Absorption rates will change continuously to reflect changes in output and costs
(d) Overhead absorption rates will only be calculated when all actual costs are known
34.A company has a budgeted level of fixed overheads of 385,000 and the overhead recovery rate is
4.25 per machine hour, What is the number of machine hours we expect to use?
(a) 90,600
(b) 4,250
(c) 385,000
(d) 1,636,25
(a) The overhead charged to production is lower than the actual overhead incurred
(b) The basis of apportioning overheads has changed during the period
(c) Actual overheads have fallen in relation to what they were expected to be
(d) The actual overhead incurred is less than the overhead that has been charged to production
(a) Be more than zero if no products were made and would then increase in direct proportion to
output
(b) Be zero if output were zero and would change erratically as output increased
(c) Be zero when output is zero and would increase in direct proportion to output
(d) Be a fixed amount when output was zero and would not increase in direct proportion to output
38. If actual units produced are lower than the budgeted level of production which of the following
types of cost would you expect to be lower than the budget?
1.