6221 CM (Pages: 2) Reg. No. .................

Name ......................

BCom DEGREE EXAMINATION, APRIL 2022

Sixth Semester
BBCM626: Applied Cost Accounting
(2019 Admission)

Time: 3 Hours Maximum: 80 Marks

Part A
Answer any ten questions. Each question carries 2 mark.

1. What do you mean by Process Costing?

2. What is normal loss?
3. Discuss the term equivalent production units.
4. What do mean by transfer price?
5. Define marginal costing.
6. Explain margain of safety.
7. What is debit variance?
8. What is idle time variance?
9. What is contract costing?
10. What is target costing?
11. Give two examples of simple cost unit.
12. What do you mean by daily Log sheet? (10×2=20)

Part B
Answer any six questions. Each question carries 5 marks.

13. Explain the merits of transfer pricing

14. A company fixes the inter-divisional transfer prices for its products on the basis of cost plus
an estimated return on investment in its divisions. The relevant portion of the budget for the
division A for the year 2018 -19 is given below.
Particulars Amount in (Rs)
Fixed Assets 7, 00,000
Current Assets (other than debtors) 3, 00,000
Debtors 2, 00,000
Annual fixed cost for the division 8, 00,000
Variable cost per unit of product 10
Budgeted volume of production per year (units) 5, 00,000. Desired Return on Investment 30%.
You are required to determine the transfer price for division A.
15. Discuss the advantages of marginal costing
16. From the following particulars calculate-
(i) Contribution (ii) P/V Ratio (iii) B E P (iv) What will be the selling price per unit if the
B E P is brought down to 25000 Units?
Fixed expenses Rs 150000
Variable cost per unit Rs 10
Selling price per unit Rs 15
17. Compare between standard cost and estimated cost.

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18. From the following information calculate material cost variance, material price variance and
material usage variance.
Material Standard Qty Standard Price Actual Qty Actual Price
A 85 kg 10 95 kg 12
B 122 kg 11 130 kg 14
19. What are the basic difference between contract costing and job costing
20. From the following calculate the amount of profit transferred to costing profit and loss account.
Rs
Total expenditure to date 85000
Contract price 180000
Work certified 100000
Work not certified 8500
Cash received 85000
21. A company runs a canteen for the benefit of employees and the employees are catered here at
subsidised rates through coupon sales. From the following information calculate the increase
in subsidy per head this month over that in the same month last year.
This month This month last year
Number of employees 4000 3500
Sales realization through coupons 35000 30000
Materials consumed 30000 25000
Labour and supervision 20000 16000
Overheads 29000 24000
(6×5=30)

Part C
Answer any two questions. Each question carries 15 marks

22. A Ltd produces a product which passes through two processes before it is completed and
transferred to finished stock. The following data relate to the month of December 2019.
Process I Process II Finished sock
Opening Stock 7500 9000 22500
Direct materials 15000 15750 -
Direct wages 11200 11250 -
Factory OH 10500 4500 -
Closing stock 3700 4500 11250
Inter process profit for opening stock - 1500 8250
Output of process I is transferred to process II at 25% profit on cost. Output of process II is
transferred to finished stock at 20% profit on cost. Stocks in process are valued at prime cost.
Finished stock is valued at the price at which it is received from process II. Sales during the
period are Rs 150000. You are required to prepare process cost accounts and finished stock
account showing profit element at each stage.
23. Explain the applications of marginal costing
24. From the following information draw a break even chart.
Budgeted output 60000units
Fixed expenses Rs 200000
Variable expenses per unit Rs 10
Selling price per unit Rs 20
If the selling price is reduced to Rs 18, what will be the new breakeven point?
25. Discuss the benefits and drawbacks of standard costing system. (2×15=30)