END OF SEMESTER EXAMINATION

COURSE TITLE: ELEMENTS OF COST ACCOUNTING

COURSE CODE:
PART A
ANSWER ALL QUESTIONS
1a. Describe the term Cost Accounting.
b. List three objectives of Cost Accounting.
c. List two functions of Cost Accounting.
2a. Define Cost Centres.
b. Explain the following;
i. Out-of-pocket cost and book cost
ii .Explicit and Implicit cost
3a. State 4 essentials of an ideal costing system.
b. List 3 differences between financial accounting and cost accounting.
c. State two importance of cost accounting.

PART B
ANSWER ONE QUESTION FROM THE FOLLOWING
1a.Calculate the factory cost for the following data
#
Cost of Direct Materials. 200,000
Direct Wages. 50,000
Direct Expenses. 10,000
Wages of Foreman. 5,000
Electric Power. 2,000
Lighting of the Factory. 4,000
Storekeeper’s Wages. 2,500
Oil and Water. 1,000
Rent of the Factory. 10,500
Depreciation in Plant 1,000
Consumable Store. 5,000
Repairs and Renewal Plant. 7,000

b. Calculate the production cost from the following data added..

Office Rent. 6,000
Office Lighting. 1,250
Office Depreciation 3,500
Director’s Fees. 2,500
Manager’s Salary. 10,000
Office Stationery. 1,000
Telephone Charges. 500
Postage and Telegrams 250
c. Calculate the cost of sales from the following data
Salesman’s Salary. 10,500
Travelling Expenses. 1,000
Carriage Outward. 750
Advertising. 3,500
Warehouse Charges 1,000
2. Calculate the prime cost, factory cost, cost of production cost of sales and profit form the
following particulars:
# #
Direct materials 200,000 Office stationery 1,000
Direct wages 50,000 Telephone charges 250
Direct expenses 10,000 Postage and telegrams 500
Wages of foreman 5,000 Salesmen’s’ salaries 2500
Electric power 1,000 Travelling expenses 1,000
Lighting: Factory 3,000 Repairs and renewal plant 7,000
Office 1,000 Office premises 1,000
Storekeeper’s wages 2,000 Carriage outward 750
Oil and water 1,000 Transfer to reserves 1,000
Rent: Factory 10,000 Discount on shares written off 1,000
Office 5,000 Advertising 2,500
Depreciation Plant 1,000 Warehouse charges 1,000
Office 2,500 Sales 379,000
Consumable store 5,000 Income tax 20,000
Managers’ salary 10,000 Dividend 4,000
Directors’ fees 2,500