COST ACCOUNTING 2006 (Regular)
Time : 3 Hours Max. Marks:100
Instructions: Attempt FIVE questions, THREE from Section-I and TWO from Section-II.
SECTION “A” (Advanced Accounting) 60 Marks
1.(a) Describe the role of Cost accounting in a Manufacturing concern.
1.(b) Briefly describe the major used to account for manufacturing costs.
2. ELEMENTS OF COSTS
A manufacturing presents the following details about the various expenses for the month of june-2006.
|Opening stock of Raw material||5,000|
|Closing stock of raw material||15,000|
|Printing and statitionery||700|
|Depreciation – office furniture||200|
|Repair of plant and machinery||1,3000|
|General manager’s salary||18,000|
|Factory manager’s salary||13,000|
|Depreciation plant and machinery||1,400|
|Research and development cost||3,000|
Classify the above expenses under the various elements of costs, showing separately the Total Expenditure.
3. PROCESS COSTING:
The following information was taken from the books and records of the Standard Manufacturing Company for the year ended Dec 31, 2005. (20)
|Sales during the year||8,000||?|
|Opening Inventory of Finished Goods||1,800||14,500|
|Work in Process||100||?|
The Foreman has submitted the following costs for the closing Work in Process.
Material Cost 2,700
Direct Labour Cost 1,000
The Company’s past experience showed that FOH Cost tend to fluctuate closely in Proportion to Direct Labour Cost.
(i) Determine the number of units manufactured during the year.
(ii) Compute the estimated cost of Work-in-Process.
(iii) Determine the Cost of each unit.
(iv) Determine the Ending inventory of Finished Goods and the Cost of Sales.
4. FACTORY LEDGER & GENERAL LEDGER:
NOT INCLUDED IN THE NEW COURSE
5. JOB ORDER COTING:
The following data relate to Irfan Manufacturing Company for its operation for the year ended Dec.31, 2005. (20)
Raw Material purchased on account Rs. 2,00,000
Material Issued to Factory:
Direct Labour for production 240,000
For general use 24,000
Other FOH incurred on account Rs.180,000.
90% of the FOH have been applied on the work-in- process account on the basis of Direct Labour Cost.
Good valued Rs. 516,000 were transferred from Factory to Godown as complete. Finished Goods costing Rs.66,000 were in the ending inventory and the rest were sold at
20% above cost.
(i) Give general Journal Entries to record the above transactions and setup work-in-process, Finished Goods and Factory Overhead account.
(ii) To Close the Factory overhead accounts.
6. PROCESS COSTING:
Kamran Manufacturing uses Process cost System. The cost of process 2 for the month of May were as under:
Cost from preceding process Rs. 60,000
Cost Added by the process:
Following information was obtained from the departments Quantity Schedule.
Units Received 7,500
Units transferred 6,000
Units still in process1,500
The degree of completion of work in process was 50% of the units were 40% complete 20% of the units were 30% complete and the balance of the units was 20% complete.
(i) Prepare cost of production report for department 2 for May 2006.
(ii) General Journal entries to record:
(a) Transfer of 7500 units from preceding department to process 2.
(b) Manufacturing Cost added in process 2 during May 06.
(c) Transfer of 6000 units from process 2 to finished goods warehouse.
7. MATERIAL LOSSES:
NOT INCLUDED IN THE NEW COURSE
8. Describe briefly the following: (20)
(i) Manufacturing Cost
(ii) Distribution Cost
(iii) Administrative Cost
(iv) Standard Cost
(v) Historical Cost
(vi) Variable Cost
(vii) Fixed Cost
(ix) Spoiled Units
(x) Defective Units.
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