Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program

QUESTION BANK
Course
Particulars
Specification

Type Core

Course Code-
C2203: COST CONTROL & MANAGEMENT ACCOUNTING
Course name

Semester SEM-I

Offered in EVEN SEM

Credits 4

AR
Standard
Six Units
Specification

Pedagogy Interactive lecture session

LW
Evaluation
Pattern

Mode of Study Classroom study

A
DM
The objective of this course is make students understand the evolution of
Course
cost accounting, various techniques of estimating cost.
Objective
KO

Students will be able to:

Course 1. Apply the concept of various techniques of cost and management accounting (PO1)
Outcomes 2. Analyse various costing concepts(PO2)
IK

3. Predict the estimation for future by preparing various budgets.(PO2)(PO4)

4. Formulate decisions on the basis of marginal costing & operating costing
techniques.(PO2)(PO4)
AT

1)
PR
MR
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program

SAQs & LAQs

Course
SN Question
Outco
me
CO1 Why do we study Cost Accounting? ICAI Study
Material &
1
Bhagvati
Pillai
CO1 Classify the costs using a diagram and elaborate each cost in brief. ICAI Study

AR
2 Material &
Bhagvati
Pillai
Differentiate Cost Control and Cost Reduction in your own words ICAI Study

LW
Material &
Bhagvati
Pillai
CO1 The following are the particulars applicable to a work ICAI Study
3 process:
Time rate : Rs. 10 per unit A Material &
Bhagvati
DM
High Task : 40 units per week Pillai
Piece rate above high task Rs 5.50 per unit
In a 40 hours week each of the following workers produced :
A 35 units
KO

B 40 units
C 41 units
D 52 units
Calculate the wages of the worker under Gantt’s Task Bonus Plan.
IK

CO2 IQIZ estimated its factory overhead for the next period at $160,000. It is Financialstrate
4 estimated that 40,000 units will be produced at a materials cost of $200,000. gists.com
Production will require 40,000 man-hours at an estimated wage cost of
AT

$80,000. The machines will run for approximately 25,000 hours.

Required: Calculate the factory overhead rate that may be used in applying
FOH to production on each of the following bases:
PR

Materials cost
Direct labor cost
Direct labor hours
Machine hours
MR

Units of production
Prime cost

CO2 A machine costing 2,00,00,000 is expected to run for 20 years.. At ICAI

5 the end of this period its scrap value is likely to be ` 8,00,000. Study
Repairs. during the whole life of the machine are expected to be Material &
36,00,000 and the machine is expected to run 3,380 hours. per year on the Bhagvati
average. Its electricity consumption is 15 units per hour, the rate per unit Pillai
being 5. The machine occupies one-fourth of the area of the department and
has two points out of a total of ten for lighting. The foreman has to devote
about one sixth of his time to the machine. The monthly rent of the
department is 30,000 and the lighting charges amount to ` 8,000 per month.
The foreman is paid a monthly salary of 19,200. Find out the machine hour
rate, assuming insurance is @ 1% p.a. on 1,00,00,000 and the expenses on
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
oil, etc.,
are 800 per month.
CO1 From the following particulars calculate the wages of 3 workers Pratik, Vijay ICAI
6 and Pritam under Merrick’s Differential Piece Rate. Piece Rate is 20 paise Study
per unit, standard output 20 units per day of 6 hours. Material &
Outputs: Bhagvati
Amar – 14 units, Pillai
Akbar – 20 units
Anthony – 16 units.
CO2 yourarticlelibr
7 ary.com

AR
LW
CO1 How would you deal with ethical issues related to the preparation of Cost Mbaknol.com
8 Sheet.

9
CO1
A
Elaborate the term Unit Costing in your own words Investopaedia.
com
DM
CO1 JP Morgan Chase Ltd. supplies you the following information and requires ICAI
10 you to Study
prepare a cost sheet. Material &
KO

Stock of raw materials on 1st Sept., 2022 75,000 Bhagvati

Stock of raw materials on 30th Sept., 2022 91,500 Pillai or
Direct wages 52,500 ICMAI
Indirect wages 2,750
IK

Sales 2,00,000
Work-in-progress on 1st Sept., 2022 28,000
AT

Work-in-progress on 30th Sept., 2022 35,000

Purchases of raw materials 66,000
Factory rent, rates and power 15,000
Depreciation of plant and machinery 3,500
PR

Expenses on purchases 1,500

Carriage outward 2,500
MR

Advertising 3,500
Office rent and taxes 2,500
Travelers.’ wages and commission 6,500
Stock of finished goods on 1st Sept., 2022 54,000
Stock of finished goods on 30th Sept., 2022 31,000
11 CO2 Theorize the process of reconciling the profit using both P&L account and ICAI and
Cost Sheet Bhagvati
Pillai

CO3 Demonstrate the pro-forma of Cost Sheet, Tender Quotation and ICAI and
Reconciliation. Bhagvati
12 Pillai
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
13 CO1 From the following particulars, prepare cost sheet showing ICAI and
the comparative cost per ton for the period : Bhagvati
Pillai
Particulars 31st 30th
March June
(Rs.) (Rs.)
Productive wages 62000 88000
Administrative expenses 12000 12000
Raw Material 36000 49000
Taxes and Insurance ( Factory) 750 750
Light and water 1000 1000
Direct Expenses 9000 12500
Depreciation 2000 2000
Factory Rent 1500 1500

AR
Unproductive labour 30000 41000
Factory repairs 3000 4500
TOTAL 167250 222250

LW
14 CO2 ICAI and
Bhagvati
Pillai

A
DM
15 CO2 Prepare statement of cost and profit from the following information ICAI and
KO

Particulars Amount Bhagvati

(Rs.) Pillai
Opening stock of raw materials 20000
Purchase of raw materials 60000
IK

Materials returned to supplier 1000

Closing stock of raw materials 9000
AT

Direct wages 10000

Works on cost 25% on wages

PR

Office on cost 20% on works cost

Selling on cost 10% on works cost
Profit 10% on cost
MR

16 CO2 Demonstrate how the cost units differ in case of Operating Costing. ICAI and
Bhagvati
Pillai

17 CO1 From the following figures show the cost of the three process of ICAI and
manufacturing. The production of each process is passed on to the next Bhagvati
process immediately on completion of Last process. Pillai
Particulars Process Process Process
A (Rs.) B (Rs.) C
(Rs.)
Wages & Material 40400 22000 39250
Works overhead 5600 52150 6000
Production in units 36000 37500 48000
Stock ( Unit from - 4000 16500
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
preceding process)
1st July
Stock ( Unit from - 1000 5500
preceding process)
31st July

18 CO2 Shanker has been promised a contract to run a tourist car on a 20 km. long ICAI and
mute for the chief executive of a multinational firm. He buys a car costing Bhagvati
Rs.1,50,000. The annual cost of insurance and taxes are Rs. 4,500 and Pillai
Rs.900 respectively. He has to pay Rs.500 per month for a garage where he
keeps the car when it is not in use.
The annual repair costs are estimated at Rs.4,000. The car is estimated to
have a life of 10 years, at the end of which the scrap value is likely to be
Rs.50,000.
He hires a driver who is to be paid Rs.300 per month plus 10% of the takings

AR
as commission. Other incidental expenses are estimated at Rs.200 per month.
Petrol and oil will cost Rs.100 per 100 kms. The car will make 4 round trips
each day. Assuming a profit of 15% on takings is desired and that the car will

LW
be on the road for 25 days on an average per month what should he charge
per round-trip?
19 CO1 From the following information of Shiva travels calculate total kilometer and ICAI and
total passenger kilometers: Bhagvati

Number of buses A 5
Pillai
DM
Days operated in the month 20
Trip made by each bus 4
Distance of route (one side) 20kms
Capacity of bus 50 passenger
KO

Normal passenger travelling 90% of

capacity

20 CO1 Where will you treat the wastage in the pro-forma of process costing? ICAI and
IK

Bhagvati
Pillai
AT

21 CO2 Keshav Ltd. is producing the product “Ace” required to be processed in three ICAI and
continuous processes. They have laid down the standards to produce 75 litres Bhagvati
PR

of finished product as under: Pillai

Process Number
Respective Costs 1 2 3
MR

Raw Material (litres) 100 - -

Materials Cost per liter
(Rs..) 2 - -
Waste percentage on input
(%) 10 11.11 6.25
Direct Labour Hours. 6 10 8
Labour Rate Per Hour (Rs..) 7.5 10 12.5
Overhead Rate Per Labour
Hour (Rs..) 3.5 3 8
Sale Price Per Litre of
Finished Goods (Rs..) - - 9
You are required to prepare the statement of standard cost and standard profit
rate per 75 liters. of finished product.
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
22 CO1 Demonstrate the difference between job and process costing by creating ICAI and
numerical Bhagvati
using assumed figures. Pillai

23 CO2 How would you define the terms normal and abnormal wastages in a layman ICAI and
language. Bhagvati
Pillai

24 CO1 The Nike Construction Company undertakes large contracts. The following ICAI and
particulars. relate to contract No. 125 carried out during the year ended on Bhagvati
31st March, 2021. Pillai

Particulars. Rs.. Particulars. Rs..

AR
Work 1,43,000 Wages 1,800
certified by accrued on
architect 31st March
2015

LW
Cost of 3,400 2,400
work not Direct
certified expenditure
Plant 11,300 Materials on 1,400
installed at A
hand on 31st
DM
site March 2015
Value of 8,200 400
plant on Materials
31st March returned to
2015 store
KO

Materials 64,500 Direct 200

sent to site expenditure
accrued on
31st March
IK

2015
Labor 54,800 Contract price 2,00,000
AT

Establishment 3,250 Cash received 1,30,000

charge from the
Contractee
PR
MR

CO1 Elaborate the terms Work Certified and Work Uncertified using the example ICAI and
25 of a construction contract. Bhagvati
Pillai

CO1 Define the term escalation clause in your own words. ICAI and
Bhagvati
26 Pillai

CO2 Explain your understanding about ‘employee absenteeism’. ICAI and

Bhagvati
Pillai
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
CO1 Following expenses were incurred by Javed contractor company on a ICAI and
contract which started on 1st Jan. Bhagvati
Particulars Amount Pillai
(RS)
27 Material 50000
Wages 50000
Other expenses 25000
Plant at cost 50000
Work certified 120000
Work uncertified 60000
Material on hand (31st Dec) 11000
Plant value at close 43000
Cash received from contractee 100000
Material returned in store 2000

AR
Prepare Contract Account and Work In Progress, assuming that the contract
price was Rs 250000. How will WIP appear in the Balance Sheet of the
contractor?

LW
CO2 A company's contract ledger shows the following details in respect of ICAI and
Contract No. 50, which commenced on 1 April 2019. Bhagvati
Pillai

28 A
DM
KO

The contract was completed by 31 March 2020 at a contract price of

$200,000.
The values of the materials and plant returned to store on 31 March 2020
IK

were $6,000 and $12,000, respectively. The contract price was received in
full on 31 March 2020.
AT

Required: Prepare a contract account and contractee's personal account.

CO2 How much profit , if any, would you allow to be considered in the following ICAI and
PR

case? Bhagvati
29 Particulars Amount Pillai
(Rs)
Contract cost (up to date) 380000
MR

Contract value 500000

Cash received 170000
Uncertified Work 30000
Deduction from bill by way of security 10%

CO1 From the following information of Arya travels calculate total kilometer and ICAI and
total passenger kilometers: Bhagvati
30 Pillai
Number of buses 5
Days operated in the month 25
Trip made by each bus 4
Distance of route (one side) 25kms
Capacity of bus 50 passenger
Normal passenger travelling 90% of
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
capacity

Elucidate the difference between Budget, Budgeting and Budgetary Control ICAI and
Bhagvati
31 CO3 Pillai

CO3 Demonstrate all mainstream budgets with their subtypes through ICAI and
32 diagrammatic representation. Bhagvati
Pillai

33 CO3 Draw the pro-forma of both Fixed & Flexible Budget. ICAI and
Bhagvati
Pillai

AR
34 CO3 Using the following information, prepare a flexible budget for the production ICAI and
of 80% and 100% activity. Bhagvati

LW
Production at 50% 5,000 Pillai
Capacity Units
$80 per
Raw Materials
unit
Direct Labor
$50 per
unit A
DM
$15 per
Direct Expenses
unit
$50,000
Factory Expenses (50)
KO

(Fixed)
Administration $60,000
Expenses (Variable)
IK

The following data is available in a manufacturing company for a yearly

35 period. ICAI and
AT

CO3 Bhagvati
$ Pillai
PR

Fixed Expenses

Wages and Salaries 9,50,000

MR

Rent/Rates and Taxes 6,60,000

Depreciation 7,40,000
T
.
Sundry Admin Expenses 6,50,000

Semi-variable Expenses at 50% Capacity

Maintenance and Repairs 3,50,000

 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
Indirect Labor 7,90,000

Sales Department Salaries, etc. 3,80,000

Sundry Admin Salaries 2,80,000

Variable Expenses

Materials 21,70,000

Labor 20,40,000

AR
Other Expenses 7,90,000

LW
Total 98,00,000

You should assume that the fixed expenses remain constant for all levels of
production.
A
Semi-variable expenses remain constant between 45% and 65% capacity,
DM
increasing by 10% between 65% and 80% capacity, and by 20% between
80% and 100% capacity.
The sales at various levels of capacity are the following:
50% Capacity 100
60% Capacity 120
KO

75% Capacity 150

90% Capacity 180
100% Capacity 200
IK

For this task, prepare a flexible budget for the year and forecast the profit at
60%, 75%, 90%, and 100% capacity.
AT

ICAI and
CO4 Is Marginal costing nothing but absorption Costing. Comment and Explain Bhagvati
36 Pillai
PR

What do the terms PV Ratio and Margin of safety signifies. ICAI and
37 CO4 Bhagvati
MR

Pillai
38 CO4 Is the term BEP equivalent to zero profit? State how? ICAI and
Bhagvati
Pillai
39 CO4 A company produces 500 units at a variable cost of $200 per unit. The price Fianncialstrate
is $250 per unit and there are fixed expenses of $12,000 per month. gist.com
40 CO4 For a company, sales are $80,000, variable costs are $4,000, and fixed Fianncialstrate
costs are $4,000. Calculate the following: (i) PVR, (ii) BEP (Sales), gist.com
(iii) Margin of Safety, and (iv) Profit.
41 CO4 Calculate (i) PVR, (ii) BEP, and (iii) Margin of Safety based on the Fianncialstrate
following information: gist.com
Sales = $100,000
Total cost = $80,000
Fixed cost = $20,000
 Nagar Yuvak Shikshan Sanstha’s

Datta Meghe Institute of Management Studies

Atrey Layout, Nagpur--- 440 022
Autonomous Institute Affiliated to Rashtrasant Tukadoji Maharaj Nagpur University
with NBA accredited MBA program
Net profit = 80,000

AR
A LW
DM
KO
IK
AT
PR
MR