FACULTY OF SCIENCE

UNIVERSITY OF JAFFNA- SRI LANKA

Level 2G/2S – 2016/2017
ACC (i) 2229: Cost and Management Accounting
Tutorial Questions

Question No: 01
The costs of the process of BMW manufacturer are as follows:
Process 1
(Rs)
Direct materials 6,000
Direct labour 1,000
Direct expenses 2,000
Production overhead 1,000

Additional information:
 The input quantity was 500 kg
 The expected or normal loss was 10 per cent of input.
 Actual output was 450 kg.
 Normal loss could be sold for scrap at a value of Rs.5 per kg
Required to prepare Process Account 1 and scarp account.
Question No: 02
The following cost information is extracted from Holder Manufacturing Company for the
last quarter of 2018:
Process A
(Rs)
Input 500 kg of materials costing 6,000
Labour cost 1,000
Expenses cost 2,000
Overhead cost 1,000

Additional information:
 Normal loss is estimated to be 10 per cent of input.
 Losses may be sold as scrap for Rs.5 per kg.
 Actual output was 430 kg.
Requirements:
a) Process A account
b) Scrap account and
c) Abnormal loss or gain a/c

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Question No: 03
A company uses process costing to value its output and all materials are input at the
start of the process. The following information relates to the process for one month:
Input 3000 units
Opening stock 400 units
Losses 10% of input is expected to be lost
Closing stock 200 units

How many good units were outputs from the process if actual losses were 400 units?

Question No: 04
A company uses process costing to value its output. The following was recorded for the
period:
Input materials 2000 units at Rs.4.50 per unit
Conversion costs Rs.13 340
Normal loss 5% of input valued at Rs.3 per unit
Actual loss 150 units

There were no openings or closing stocks. What is the valuation of one unit of output?

Question No: 05
Lasith Malinga (LM) has a factory which operates two production processes, Process –
A and Process - B. Normal loss in each process is 10%. Scrapped units out of the
Process - A sell for Rs. 3 per unit, whereas scrapped units out of the Process – B sell for
Rs. 5. Output from the Process - A is transferred to the Process - B: output from the
Process - B is finished output ready for sale.
Relevant information about costs for control period 7 are as follows.
Process - A Process - B
Units Rs Units Rs
Input materials 18,000 54,000
Transferred to Process - B 16,000
Materials from Process - A 16,000
Added materials 14,000 70,000
Labour and overheads 32,400 135,000
Output to finished goods 28,000

Required to prepare accounts for the Process - A, the Process - B, abnormal loss,
abnormal gain and scrap.

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