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Cost & Management Accounting

Question 1

Rayan Ltd has provided the following information:
Quantity (kg) Unit Rate (Rs.) Total (Rs.)
Standard
Material X 10 2 20
Material Y 20 3 60
Material Z 20 6 120
Total 50 200
Actual
Material X 5 3 15
Material Y 10 6 60
Material Z 15 5 75
Total 30 150


You are required to compute the following and interpret the result:
a) Material cost variance
b) Material price variance
c) Material usage variance (10 marks)

Question 2

Tony India produces a single product. The following figures related to the single product for the year 2021-22 is given.
Activity Level 50% 100%
Sales (units) 400 800
Sales (Rs.) 8,00,000 16,00,000
Production costs:
Variable 3,20,000 6,40,000
Fixed 1,60,000 1,60,000
Selling and distribution cost
Variable 1,60,000 3,20,000
Fixed 2,40,000 2,40,000

Prepare the Income statement under marginal costing for sale of 600 units. (10 marks)

Question 3a

Picture Ltd are manufacturers of picture tubes for television. The following data is available with respect to a product.

(a) Cost of placing a purchase order is Rs. 20
(b) Number of units to be purchased during the year is 5,000
(c) Purchase price per unit inclusive of transportation cost is Rs. 50
(d) Annual cost of storage per units is Rs. 5

You are required to compute the Economic Order Quantity. What if the inventory maintained by the company is 500 units? (5 marks)

Question 3b

Avent Ltd manufacturing a single product. The selling price of the product is Rs. 500 per unit. The unit variable cost is Rs.300 per unit and a fixed cost of Rs.2,00,000 per month is incurred. Compute the breakeven point in units and value. (5 marks)

Sep 2023 Plagiarized Assignments Contact
[email protected]
+91 9902787224