Accounting 101

[ December ¯ 2011 ]

INTERMEDIATE EXAMINATION

(REVISED SYLLABUS - 2008)

GROUP - II

Paper-8 : COST AND MANAGEMENT ACCOUNTING

Q. 1. (a) Match the statement in Column 1 with the most appropriate statement in Column 2 :

Column I

Value analysis

Performance of public enterprise

Balance score card

Residual income

Variance analysis

Column II

Performance analysis

Management by exception

Measures divisional performance

Technique of cost reduction

Shows profitability and capacity utilisation

Q. 1. (b) State whether the following statements are True (T) or False (F) :

(i)

(ii)

(iii)

(iv)

(v)

Profit planning and control is not a part of budgetary control mechanism.

Cost industry makes use of output costing.

Idle time variance is always adverse.

Ash produced in thermal power plant is an example of co-product.

The stock turnover ratio indicates the slow moving stocks.

Q. 1. (c) In the following cases one out of four answers is correct. You are required to indicate the correct

answer and give reasons for answer :

(i) The cost data pertaining to Product “X” of XL Ltd. are as follows :

Maximum capacity

30,000 units

Normal capacity

15,000 units

Increase in inventory 1,880 units

Variable cost per unit Rs. 12

Selling price per unit Rs. 50

Fixed manufacturing overhead costs

Rs. 3,60,000

If the profit under Absorption costing method is Rs. 1,01,000, the profit under Marginal

costing method would be

A. Rs. 1,46,120

B. Rs. 1,23,560

C. Rs. 55,880

D. Rs. 73,340

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[ December ¯ 2011 ]

Revisionary Test Paper (Revised Syllabus-2008)

(ii) Which of the following does not influence the use of activity-based costing?

A. High proportion of overhead costs

B. Product complexity

C. Monopoly position

D. Volume diversity

(iii) Budgeted sales for the next year is 5,00,000 units. Desired ending finished goods inventory is

1,50,000 units and equivalent units in ending W-I-P inventory is 60,000 units. The opening

finished goods...