Master of Commerce (M.Com.) Part II SEM III 2018 2019 Dec 2019 GROUP A ADVANCED ACCOUNTING, CORPORATE ACCOUNTING AND FINANCIAL MGT. ADVANCED COST ACCOUNTING Question Paper - Mumbai University | munotes

Questions asked in this paper

• (2) Figures to the right indicate full marks

1. Q2 MST Limited has collected the following data for its two activities. It activity cost rates based on Quality Inspections Namber of inspections 10,000 Inspections 3,00,000 ct 72211 /Group A: Advanced Accounting, , Corporate Accounting ing and Financial The company makes three products M, S and T. For the year ended March 31, 2018, the following consumption of cost drivers was reported :
   • (i) Compute the costs allocated to each product from each activity,
   • (ii) Calculate the cost of unused capacity of each activity,
   • (iii) the factors the management considers in choosing a capacity level to compute the
2. Q2 The following information relates to budgeted operations of Division X of a manufacturing The amount of divisional investment is Rs. 1,50,000 and the minimum desired rate of return on the investment is the cost of capital of 20%,
   • (iii) | Comment on the result of (ii)
   • (iv) divisional manager has the opportunity to sell 10,000 units at Rs. 7.50 per unit. Variable cost per unit would be the same as budgeted, but fixed costs would increase by Rs. 5,000, Additional investment of Rs. 20,000 would also be required. If the manager accepts the special order, by how much and in what direction would his residual income change?
3. Q3 PQR Industries Ltd. has two divisions M and N. Division M manufactures product A — 15 which it sells in outside market as well as to Division N which processes it to manufacture Z — 25, The Manager of Division N has expressed the opinion that transfer price is too high. The two Divisional Managers are about to enter into discussions to resolve the conflict, and Manager of division —M to supply him with some information prior to discussions Division M has been selling 50,000 units to outsiders and 10,000 units to Division N, all at Rs. 25 per unit it is not anticipated that these demand will change. The variable cost is Rs. 15 per unit and the fixed costs are Rs, 3 Lakhs. Divisional investment is asset is Rs. 12 lakhs The Manager of Division M anticipates that Division N will want a transfer price of Rs. 22. If he does no sell to Division N, Rs. 40,000 of fixed costs and Rs, 2,00,000 of assets can be avoided. The Manager of Division M would have no control over time proceeds from the sale of the assets and is judged primarily on his rate of Should the Manager of Division M transfer its products at Rs. 22 to Division N ? 15 marks
4. Q2 What is the lowest price that the Division M Group A: Advanced Accounting, Corporate Accounting and Financial Management ; Advanced Co:
5. Q3 A summary of the balance sheet of ABC co. given below 15) Current Debts 6,00,000 | Cash and Accounts Receivable 13,00,000 The current price index is 280. The plant and equipment and the long- term debts were acquired when the A price index was at 180 Revised the summary balance sheet to restate al! assets and equities in the terms of current rupees. How will you treat the monetary gain or loss, if any? 4.(A) State whether following statements are True or False: (08) Visible waste means residue such as slag also no sale value
6. Q2 The sale value of the units of abnormal loss is credited to the process A/c
7. Q3 Cash discounts are generally excluded completely from the costs
8. Q4 Variable overhead vary with time
9. Q5 Activity cost pools are cost accumulations associated with a given activity
10. Q6 Machine setup is normally considered a unit-level cost
11. Q7 All controllable costs are direct costs
12. Q8 In computing a transfer price, the maximum price should be no higher than the lowest market price at which the buying segment can obtained the good or service externally
13. Q4 (B) Match the following: ! Normal Output a) No. of employees 7 marks
14. Q4 Canteen d) Number of customers
15. Q6 Target cost f) Number of machine hours
16. Q7 Distribution g) A percentage of cash collection
    • i) Normal loss & (4) Write Short notes on: (Any 3) (15)
17. Q4 Equivalent Units

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