Nmims 2020 customized assignments - Describe any 2 of the above Variances and their sub variances

  • Nmims 2020 customized assignments - Describe any 2 of the above Variances and their sub variances

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, Bangalore, Karnataka


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+91 95030-94040

Cost & Management Accounting

1. Vimla Spice Company exports spices to Europe and Middle East. Given the slowdown in business due to the recent COVID-19 impact, their profits have been mpacted significantly and actual profits are lower than budgeted sales by almost 30 to 40%.The Management was extremely concerned and called for a meeting of the top team to decide the way forward.
The following 2 decisions were taken in the meeting:
a. Identify new markets for exporting spices to increase Sales
b. Hire a Management accountant to understand how they can reduce costs etc Mr Bond was hired as the Management accountant and he submitted his report to the Management within a month. The Management had thought profit reduction was primarily o/a Sales Variance but were indeed surprised to see the report as there were several other variances analyzed by Mr Bond with respect to various elements of costs, sales and profit as follows:
1. Material cost variances
2. Labor cost variances
3. Overhead variances
4. Sales variances
5. Profit variances
a) Describe Standard Costing and its applicability in specific industries
b) Describe any 2 of the above Variances and their sub variances
c) How will it benefit Vimla Spice Co if it implements Standard costing in the Co (any 2 benefits) (10 Marks)

2. “Eat Healthy” is a start up venture started by Ram and Lakhan planning to sell sugar free cakes, cookies, multi grain bread etc. They are confused as to which type of Costing method should be employed by them, Job costing or Process Costing. Describe Job costing and Process costing to them and explain the differences between Process costing and Job costing (Any 5). (10 Marks)
3. The following data is available for Lucky Soap Manufacturing Co for the year ended 31st March 2020: -
Particulars Amt (Rs)
Stock of Materials: Opg 1, 75,000
Closing stock 2, 00,000
Materials purchased during the year 7, 50,000
Direct wages paid 2, 25,000
Indirect Wages 28,000
Salaries to administrative staff 40,000
Repairs to plant and machinery 36,800
Electricity Charges 50,000
Office Expenses 7,300
Travelling expenses 18,000
Sales men have and commission 28,000
Depreciation written off: Plant and machinery 36,400
Depreciation written off: Office Furniture 5,400
Office Manager's salary 48,000
Rent, rates and Taxes- Office 7,500
Rent, rates and Taxes- Factory 12,000
Fuel 64,000

a. Calculate the Factory overheads and Other Overheads. (5 Marks)
b. Assist the MD of the company in calculating the following:- -
• Prime Cost
• Factory Cost and
• Cost of Sale
Minimum Sales amount if the profit margin has to be fixed at 20% on Cost. (5 Marks)

For Nmims Assignments Contact
[email protected]
+91 95030-94040

Number of Views: 43

Added On: 14 Sep, 2020

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