QP CODE: 24000760 24000760 Reg No : .....................

Name : .....................

B.COM DEGREE (CBCS) REGULAR / REAPPEARANCE EXAMINATIONS, MARCH

2024
Sixth Semester
CORE - CO6CRT17 - COST ACCOUNTING - 2
(Common to all B.Com Degree Programmes)
2017 Admission Onwards
8A23F126

Time: 3 Hours Max. Marks : 80

Instructions to Private candidates only: This question paper contains two sections. Answer
SECTION I questions in the answer-book provided. SECTION II, Internal Examination questions
must be answered in the question paper itself. Follow the detailed instructions given under
SECTION II

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

1. Distinguish between contract costing and job costing. ( any two)

2. Annual demand for a component is 5000 units. Set up cost per batch is Rs. 75. Annual
rate of interest is 15%. Cost of production per unit is Rs. 80. Calculate economic batch
quantity.

3. What are the advantages of cost plus contract?

4. Explain the costing procedure in transportation costing.

5. From the following information, calculate kilometres and total passenger kilometres:
Number of buses :4
Days operated in a month : 30
Trips made by each bus :4
Distance of route : 50 kms ( one side)
Seating capacity : 50 Passengers
Normal passengers travelling: 80% of capacity

6. What is Abnormal Effectiveness?

7. What is Abnormal Loss?

8. What is contribution?

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9. State the limitations of break even analysis.

10. Define marginal costing. Point out any merit of marginal costing.

11. What is Material Budget?

12. Difference between Performance Budget and ZBB. (any two)

(10×2=20)
Part B
Answer any six questions.
Each question carries 5 marks.

13. Following particulars relate to the year ended 30/06/2019

Completed Jobs Work in Progress

Materials used Rs. 50,000 10,000
Wages 35,000 7,000
Chargeable expenses 7,500 500
Materials returned to stores 500 -

Work expenses were 60% of prime costs, Administrative overheads were 30% of works
cost. The value of jobs completed during the year was Rs. 2,50,000. Prepare
Consolidated Job account to find out Profit or Loss during the year and Consolidated
Work in progress account.
A transport company is running 4 buses between two towns which are 50 kms apart. Seating
14.
capacity of each bus is 40 passengers. The following particulars were obtained from their books for
April 2019.

Wages of Drivers and conductors 2,40,000

Office staff salary 1,00,000
Cost of Diesel and oil 4,00,000
Repairs and maintenance 80,000
Tax and Insurance 1,60,000
Depreciation 2,60,000
Interest and other charges 2,00,000

Actual passengers carried were 75% of the seating capacity. All the four buses run on all days of the
month. Each bus made one round trip per day. Find out the cost per passenger kilometre.

15. Explain the various methods used for apportionment of joint costs to joint products.

16. A factory produces product X and Y is obtained as a by-product. The joint cost of
manufacture amounts to Rs 15,000. Subsequent expenses for producing X was Rs 3,800
and Y, Rs 1,700. Total amount realised on sale of Y was Rs 3,500. It yielded a profit of 20

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 % on selling price. You are required to prepare accounts relating to Product X and Product
Y after apportionment of joint cost.

17. Explain the distinguishing features of absorption costing.

18.
The sales and profit of a company during two years were as follows:
Year Sales (Rs.) Total Cost (Rs.)
2020 1,20,000 1,08,000
2021 1,40,000 1,24,000

Calculate
a. P/V Ratio b. BEP c. Sales to earn a profit of Rs 20,000/-

19. You are given the following data:

Budgeted Output- 80,000 units

Fixed Expenses- Rs. 5,00,000
Variable cost per unit - Rs.10
Selling Price Per Unit- Rs. 20

Draw a Break Even Chart showing the Break Even Point.

20. From the following information find out the overhead costs at 90% capacity and also determine the
overhead rates:
Expenses at 50% capacity
Variable Overheads:
Indirect labour 15,000
Indirect materials 9,400
Semi-variable overheads:
Repairs and maintenance (60% fixed) 5,000
Power (50% variable) 20,000
Fixed overheads:
Office expenses 20,000
Depreciation 15,000
Others 8,000
Estimated direct labour hours 1, 40,000

21. Describe the various steps in budgetary control.

(6×5=30)
Part C
Answer any two questions.
Each question carries 15 marks.

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22. Smart Construction company commenced a contract work on 1/1/2019. The following
particulars are given in connection with Contract No. 505 for the year ending 31/12/2019:
Amount
Contract Price 18,00,000
Work Certified upto 15/12/2019 12,00,000
Contractee's account( Cash received) 9,60,000
Materials issued 3,60,000
Direct wages paid 3,10,000
Overheads incurred 18,000
Sub contract cost 16,000
Depreciation on plant for the whole year 24,000
Cost of Extra Work 7,000
Recoveries for Extra Work 8,000
Materials at site on 31/12/2019 6,000
The expenditures given above include expenses incurred after December 15th also. Such
expenses are:
Amount
Materials used 21,000
Direct wages 8,000
Overheads 1,500
Depreciation 800
Prepare Contract Account

Jeeva Chemicals manufacture and sell their chemicals produced by three consecutive processes.
23.
The products of these processes are dealt with as under
Process I Process II Process III
Transferred to Next Process 662/3% 60% ---
Transferred to Warehouse for sale 331/3% 40% 100%
In each process 4% of the weight put in is lost and 6% is scrap which from Process I realised Rs.3
per tonne, from Process II, Rs.5 per tonne and from Process III, Rs.6 tonne.
The following particulars relate to April 2019.
Process I Process II Process III
Raw Material used (Tonnes) 1,400 160 1,260
Material Cost per Tonne (Rs) 10 16 7
Manufacturing Expenses (Rs) 5,152 3140 2,898

Prepare Process Cost Accounts showing cost per tonne of each process.

24. Due to industrial depression , a plant is running at present, at 50% of its capacity. The
following details are available.

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 Particulars Cost of production per unit
Direct material ₹2

Direct Labour ₹1

Variable overhead ₹3

Fixed Overhead ₹2

Total cost ₹8

Production per month 20000 unit

Total cost of Production ₹ 1,60,000
Sales ₹ 1,40,000
--------------
Loss: ₹ 20,000

An exporter offers to buy 5000 units per month @ 6.50 per unit and the company
hesitates to accept the offer for fear of increasing its already operating losses. Advise
whether the company should accept or decline this offer?

25. Prepare a cash budget for the period from 2018, July to September, from the given information.
May June July August September
Total Sales 1,50,000 1,70,000 1,80,000 1,60,000 1,85,000
Total Purchases 80,000 78,000 1,10,000 1,20,000 1,00,000
Wages 6,000 7,500 8,800 9,000 8,400
Admn. Expenses 6,000 6,200 6,800 9,500 4,700
Selling expenses 4,000 4,500 4,300 4,400 5,200
Additional information:

1. 20% of total sales and 20% of total purchases are on cash terms.
2. Time lag for making payments to creditors is two months and that for receiving
payments from debtors is one month.
3. An amount of Rs. 1, 20,000 should be given to bank as repayment of loan in
August and an amount of Rs 7500 will be collected on interest and dividend in the
same month.
4. Wages are paid in the same month.
5. Administrative expenses are paid after one month and selling expenses are paid on
a time lag of half month.
6. Every month installment on machinery purchased is to be paid Rs. 4,500.
7. Cash and bank balance on 1st July, 2018 was Rs. 8,000.

(2×15=30)

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