Solapur University Question Paper
M.Com. II (Semester – IV) Examination, 2014
MANAGEMENT ACCOUNTING (Compulsory) (Paper – III)
Day and Date : Saturday, 26-4-2014 Max. Marks : 50
Time : 3.00 p.m. to 5.00 p.m.
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Use of calculator is allowed.
1. Choose the correct alternatives : 10
1) ________ is scientifically pre-determined cost.
A) Absorption cost B) Fixed cost
C) Variable cost D) Standard cost
2) No profit, No loss point is known as ________ point.
A) Contribution B) Sales C) Break even D) Ideal
3) Make or buy decision can be facilitated with the help of
A) Variance analysis B) Marginal cost analysis
C) Standard costing D) Differential costing
4) If variable cost is Rs. 6 P/v Ratio is 40 % then selling price is Rs.
A) 10 B) 100 C) 6 D) 60
5) Absorption costing is also called
A) total costing B) variable costing
C) standard costing D) marginal costing
6) Under ________ costing stock are valued at full cost.
A) Differential B) Absorption C) Variable D) Standard
7) A report is vehicle of carring
A) Material B) Stock C) Information D) Goods
P.T.O.
Seat
No.
SLR-N – 76 -2-
8) Difference between standard cost and actual cost is called
A) loss B) standard cost
C) standard costing D) variance
9) At break even point fixed cost is always equal to total
A) variable cost B) fixed expenses
C) sales D) contribution
10) ________ is the part of total cost which changes or varies directly in proportion
with the volume.
A) Fixed cost B) Period cost
C) Variable cost D) Sales
2. Write short notes : 10
1) Essentials of ideal report.
2) Variance analysis.
3. A) Bhagwant Ltd. furnish you following particulars :
Products X requires 20 hours per unit standard rate per hour is Rs. 2
Units produced – 4000
Actual hours taken 76,000 (including 200 hrs. for power failure) at Rs. 2.10
per hour.
Calculate –
1) Labour cost variance
2) Labour rate variance
3) Labour efficiency variance
4) Labour idle time variance. 5
B) From the following data find break even point
Selling price per unit Rs. 10
Trade discount 5 %
Direct material cost per unit 3
Direct labour cost per unit 2
Fixed overheads Rs. 10,000
Variable overheads 100 % on direct labour cost. If sales are a) 10 % and 15 %
above the break even volume, determine the net profit. 5
-3- SLR-N – 76
4. The variable cost of the power drill manufactured by home tools limited is Rs. 4
and selling price Rs. 10. The company expects its net profit for the year just
ending to be Rs. 2,75,000 after charging fixed costs amounting to Rs. 85,000.
The companies production capacity is not fully utilised and market research
suggests three alternatives strategies for the forthcoming year
Strategy Reduce selling price by Sales volume expected to increase by
First 5 % 10 %
Second 7 % 20 %
Third 10 % 25 %
Assuming same cost structure as the current year, evaluate the alternative
strategies available to the company and state which is most profitable one. 10
OR
4. A factory has estimated its overheads for the next year at Rs. 48,000. The
factory works 300 days in a year. It works for 8 hours a day. The total budgeted
production for the year is 24,000 units.
Actual data for the month of April are given as under
Actual overheads Rs. 4,250
Actual output 2,100 units
Idle time 4 hours
Calculate :
1) Overhead cost variance
2) Overhead expenditure variance
3) Overhead efficiency variance
4) Idle time variance. 10
5. From the following data calculate : 10
1) Material cost variance
2) Material price variance
3) Material usage variance
4) Material mix variance
5) Material yield variance
Materials Standard Rate Actual Rate
X 8000 Kg. 1.05 7500 Kg. 1.20
Y 3000 Kg. 2.15 3300 Kg. 2.30
Z 2000 Kg. 3.30 2400 Kg. 3.50
OR
5. A firm has to instal a machine for production of a part. Two machines X and Y are
being considered. Their particulars are as follows :
Particulars Machine Machine
X Y
Cost Rs. 10,000 Rs. 20,000
Annual capacity 2000 units 5000 units
Economic life 10 years 10 years
Salvage value Nil Nil
Material per unit Rs. 3.00 Rs. 3.00
Production cost per
unit other than depreciation Rs. 5.00 Rs. 4.50
Part of existing overheads per annum Rs. 1,000 Rs. 1,000
Interest is at 9 % per annum. The part is available in the market @ Rs. 9 per unit
and can be sold at a net price of Rs. 8.50. The firm requires 3,000 units. Show
which of machines will be most economical ? 10
_______________
M.Com. II (Semester – IV) Examination, 2014
MANAGEMENT ACCOUNTING (Compulsory) (Paper – III)
Day and Date : Saturday, 26-4-2014 Max. Marks : 50
Time : 3.00 p.m. to 5.00 p.m.
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Use of calculator is allowed.
1. Choose the correct alternatives : 10
1) ________ is scientifically pre-determined cost.
A) Absorption cost B) Fixed cost
C) Variable cost D) Standard cost
2) No profit, No loss point is known as ________ point.
A) Contribution B) Sales C) Break even D) Ideal
3) Make or buy decision can be facilitated with the help of
A) Variance analysis B) Marginal cost analysis
C) Standard costing D) Differential costing
4) If variable cost is Rs. 6 P/v Ratio is 40 % then selling price is Rs.
A) 10 B) 100 C) 6 D) 60
5) Absorption costing is also called
A) total costing B) variable costing
C) standard costing D) marginal costing
6) Under ________ costing stock are valued at full cost.
A) Differential B) Absorption C) Variable D) Standard
7) A report is vehicle of carring
A) Material B) Stock C) Information D) Goods
P.T.O.
Seat
No.
SLR-N – 76 -2-
8) Difference between standard cost and actual cost is called
A) loss B) standard cost
C) standard costing D) variance
9) At break even point fixed cost is always equal to total
A) variable cost B) fixed expenses
C) sales D) contribution
10) ________ is the part of total cost which changes or varies directly in proportion
with the volume.
A) Fixed cost B) Period cost
C) Variable cost D) Sales
2. Write short notes : 10
1) Essentials of ideal report.
2) Variance analysis.
3. A) Bhagwant Ltd. furnish you following particulars :
Products X requires 20 hours per unit standard rate per hour is Rs. 2
Units produced – 4000
Actual hours taken 76,000 (including 200 hrs. for power failure) at Rs. 2.10
per hour.
Calculate –
1) Labour cost variance
2) Labour rate variance
3) Labour efficiency variance
4) Labour idle time variance. 5
B) From the following data find break even point
Selling price per unit Rs. 10
Trade discount 5 %
Direct material cost per unit 3
Direct labour cost per unit 2
Fixed overheads Rs. 10,000
Variable overheads 100 % on direct labour cost. If sales are a) 10 % and 15 %
above the break even volume, determine the net profit. 5
-3- SLR-N – 76
4. The variable cost of the power drill manufactured by home tools limited is Rs. 4
and selling price Rs. 10. The company expects its net profit for the year just
ending to be Rs. 2,75,000 after charging fixed costs amounting to Rs. 85,000.
The companies production capacity is not fully utilised and market research
suggests three alternatives strategies for the forthcoming year
Strategy Reduce selling price by Sales volume expected to increase by
First 5 % 10 %
Second 7 % 20 %
Third 10 % 25 %
Assuming same cost structure as the current year, evaluate the alternative
strategies available to the company and state which is most profitable one. 10
OR
4. A factory has estimated its overheads for the next year at Rs. 48,000. The
factory works 300 days in a year. It works for 8 hours a day. The total budgeted
production for the year is 24,000 units.
Actual data for the month of April are given as under
Actual overheads Rs. 4,250
Actual output 2,100 units
Idle time 4 hours
Calculate :
1) Overhead cost variance
2) Overhead expenditure variance
3) Overhead efficiency variance
4) Idle time variance. 10
5. From the following data calculate : 10
1) Material cost variance
2) Material price variance
3) Material usage variance
4) Material mix variance
5) Material yield variance
Materials Standard Rate Actual Rate
X 8000 Kg. 1.05 7500 Kg. 1.20
Y 3000 Kg. 2.15 3300 Kg. 2.30
Z 2000 Kg. 3.30 2400 Kg. 3.50
OR
5. A firm has to instal a machine for production of a part. Two machines X and Y are
being considered. Their particulars are as follows :
Particulars Machine Machine
X Y
Cost Rs. 10,000 Rs. 20,000
Annual capacity 2000 units 5000 units
Economic life 10 years 10 years
Salvage value Nil Nil
Material per unit Rs. 3.00 Rs. 3.00
Production cost per
unit other than depreciation Rs. 5.00 Rs. 4.50
Part of existing overheads per annum Rs. 1,000 Rs. 1,000
Interest is at 9 % per annum. The part is available in the market @ Rs. 9 per unit
and can be sold at a net price of Rs. 8.50. The firm requires 3,000 units. Show
which of machines will be most economical ? 10
_______________
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