age 1, (a) A company producing a single product and sel st it at €50°per unit. The unit variable is €35 and fixed cost amounts to 712 lakh per annum, With this data, you are required to calculate the following, treating each as independent of other: I. P/V ratios and break- even sales in rupees and units. a New break-even sales if the variable cost increases by %3 per unit, without any increase in selling price. III, Inerease in sales required the profits are to be increased by %2,40,000. IV. Percentage increase/decrease in the sales- volume units to offset. (i) An increase of %3 in the variable cost per unit, 1294 3 » (i) A 10% increase in the selling price without affecting the existing profits quantum. ° V. Quantum of advertisement expenditure permissible to increase the sales by %1,20,000 without affecting the existing profits quantum. (15) (b) Briefly define relevant costs in decision making, @) Prepare a cash budget for the three months ending 31st, December, 2022 Max Company Ltd. has given the following particulars, You are required to prepare a cash budget for the three months ending 31% December 2022 : Materials @)_[ Wass @ 10.200 3.800 1,300 10,000 3,800 2.100) ‘October 9,800 2.300) "November 10,000 2,400 [December 16,800. 2.500 PTO}1294 4 1, A Plant will be installed in August, 2022 at 12,200 a cost of 400,00, The monthly i of €5,000 is payable from October onwards, ment Ml. Dividend at 10% on preference share capital of €3,00,000 will be paid on I December 2022. Ill. Advance to be received for sale of equipment’s $20,000 in December 2022. IV. Income-tax (advance) to be paid December 2022 £5,000. V. Credit terms are: (i) Sales/Debtors: 10% sales are on cash basis. 50%. of the credit sales are collected next month and the balance in the following month: (ii) Creditors: Materials 2 months VI. 20% of wages are paid in the followin month. 1294 5 . 50% of overheads are paid in the following month, |. Cash balance on Ist October, 2022 is expected to be %8,000. (5) (b) What is zero-based budgeting? Briefly explain. @) 3. (a) The following information is given in respect of an engineering company [Products A B Te ] ‘Raw material cost per unit @A | 200 120 300 Labour cost per unit @) 2 20 16 Variable overhead per unit(@)2 [3 3 4 Selling price per unit(@) = [250 —y [200 -y [4005 ‘Maximum sales demand (units) | 6,000 "|_| 4.000. [3.000 J ‘The maximum raw materials available is 1,00,000 ke @ 220 per kg. The maximum labour hours available is 1,84,000 @ %0,80 with facility for a further 15,000 hours on over time basis at twice the normal wage rate. P.T.O.1294 294 7 You ate required to Actual output was 90 units. Suggest the attainable product mix which will give Calculate the material cost variances the highest profits? (is) (Material Price Va & Gi) Material Usage Variance nee 1 (b) Write the differences between cost reduction and ‘ control. @) \ i)-Material Cost Variance - f ‘ (a) The standard mix of a product for 10 units is as (je) Material M nee given below ; a y ! (v) Material Yield Variance, «s) V Product Units, Rate (%) per unit A 60 ols | (b) Briefly explain the limitations of standard costing, 8) B 80 0.20 c 100 0.25 \ (6 Write short no, 2. any Three: (3x6=18) Xu uring a particular month consumption was: . yee BP pt * (B) Comparison beween Cost Accounting and Product — | Units Rate (8) per unit Management Accounting A 640 0.20 GY Target Costing : id O15 (ap Flexible Budget and Fixed Budget c 840 30 P.T.O.4 8 (iv) Activity Based Costing (v) Budgetary Control