MA 2 Paper 1

I. Introduction (Chapter 1 & 2)

1 Place a tick in the column to indicate which THREE of the following statements are correct.

Correct ?
Cost accounting can be used for inventory valuation to meet the requirements
of internal reporting only
Management accounting provides appropriate information for decision
making, planning, control and performance evaluation
Routine information can be used for both short-term and long-run decisions
Financial accounting information can be used for internal reporting purposes
Management accounting information must be presented in a prescribed
industry format

26 Which of the following are characteristics of management accounting Information?

(i) Non- financial as well as financial

(ii) Used by all stakeholders
(iii) Concerned with cost control only
(iv) Not legally required

A (i) and (iv)

B (ii) and (iii)
C (i), (ii) and (iii)
0 (ii), (iii) and ( hr)

Question ( 2 )
State which cost unit would be applicable to each of the following:
1. Goldmining
2. Restaurants
3. Heavy goods transport
4. Oil refining
5. Nursing wards of a hospital
6. Supply of gas
7. Manufacture of ready mixed concrete
8. Consultant management accountant
9. Sales invoicing
10. Personnel and welfare

Question ( 3 )
Required
State suitable cost units to be used in the following business activities:
1 A college
2 A house builder
3 A carpet manufacturer
4 A coal mine
5 An accountant in practice
6 A hospital
7 A water treatment plant
8 AWine-maker
MA 2 Paper 1
 MA 2 Paper 1

II. Cost Classification (Chapter- 3)

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MA 2 Paper 1
MA 2 Paper 1
MA 2 Paper 1
 MA 2 Paper 1
III. Cost recording, Material (Chapter 7)

Prepare Inventory ledger using following method .

(a) FIFO (b) LIFO (c) Perpetual / Continuous / Cumulative AVCO
(d) Calculate cost of each issue and cost of closing Inventory.
MA 2 Paper 1
 MA 2 Paper 1
IV. Cost Recording Material Inventory Control (Chapter -7)

Calculate EOQ by tabulation method and formula method