Time : 2 Hours Total
Marks : 50
N.B.
1. All questions are compulsory and subject to internal choice.
2. Figures to right indicates full marks.
3. Use of simple calculator is allowed.
Q.1) Solve. (1 out of 2)
A) Z Ltd. Produces and sales a single article at ₹ 10 each. The
marginal cost of production is ₹ 6 each and fixed cost is ₹ 40 per
annum.
Calculate :
1) P/V Ratio.
2) The break even sales. (in ₹ and Nos.)
3) The hale to earn profit ₹ 500.
4) Profit at sales of ₹ 3,000.
5) New break even point if sales price reduced by 10%.
6) Margin of safety at sales of ₹ 1,500
7) Selling price per unit if break even point is reduced to 80
units.
Or
B) A pen manufacturer makes an average net profit of ₹ 25.00
per pen on a selling price of ₹143.00 by producing and selling
60,000 pens, or 60% of the potential capacity. His cost of sales is:
₹
Direct Materials 35.00
Direct Wages 12.50
Works Overheads (50% fixed) 62.50
Sales Overheads (25% variable) 8.00
During the current year his intends to produce the same number
of pens but anticipates that his fixed charges will go up by 10%
while rates of direct labour and direct material will increase by 8%
and 6% respectively. But he has no option od increasing the
selling price. Under this situation, he obtains an offer for a further
20% of his capacity. What minimum price will you recommend for
acceptance to ensure the manufacturer M overall profit of ₹
16,73,000.
Q.2) Solve. (1 out of 2)
A) From the following particulars calculate material variances
including material sub-variances. The standard mix required for
the product is, Material A – 60% at standard price ₹40 per kg and
material B – 40% at standard price ₹60 per kg. Normal Loss is
10% of total input
Actual output obtained during the period was 3,600 units in which
actual consumption of materials are:
Material A – 2,550 kgs @ ₹ 42 per kg.
Material B – 1,750 kgs @ ₹ 59 per kg
Or
B) The standard cost for the product shows :
Material cost 2 kg @ 250 each ₹ 5.00 per unit.
Wages : 2 hours @ ₹ 1.00 each ₹ 2.00 per unit.
The actuals which have emerged from business operations are
as follows :
Production 8000 units
Materials Consumed 16,500 kg @ ₹ 2.40 each ₹ 39,600
Wages paid 18000 hours @ ₹ 1.20 each ₹
21,600
You are required to compute appropriate Material Cost and Labour
Cost Variances.
Q.3) Solve. (1 out of 2)
A) The budgeted output of a factory specialising in the
production of single product at the optimum capacity of 6,400
units per annum amounts to ₹ 1,76,048 as detailed below :
Particulars ₹ ₹
Fixed Cost 20,688
Variable
Costs :
Power 1,440
Repair, etc. 1,700
Miscellaneou 540
s
Direct 49,280
Materials
Direct Labour 1,02,4 1,55,3
00 60
1,76,0
48
Having regard to possible impact an sales turnover by market
trends, the company decides to have a flexible budget with
production of 3,200 and 4,800 units (the actual quantity proposed
to be produced being left to a later date before commencement of
budget period). Prepare a flexible budget for production levels at
50% and 75%. Assuming the sale per unit is maintained at ₹ 40
as at present, indicate the effect of net profit. Administration,
selling and distribution expenses continue at ₹ 3,600.
Or
B) From the following information and the assumption that the
balance in hand on 1st January is ₹ 72,500, prepare Cash-Budget.
Month Sales Materi Wag Selling Producti Administra
als es Distributi on tion
₹ on Cost Cost
₹ ₹ Cost ₹ ₹ ₹
Januar 72,00 25,000 10,0 4,000 6,000 1,500
y 0 00
Februa 97,00 31,000 12,1 5,000 6,300 1,700
ry 0 00
March 86,00 25,500 10,6 5,500 6,000 2,000
0 00
April 88,60 30,600 25,0 6,700 6,500 2,200
0 00
May 1,02,5 37,000 22,0 8,500 8,000 2,500
00 00
June 1,08,7 38,800 23,0 9,000 8,200 2,500
00 00
Assume that 50% are Cash Sales. Assets are acquired in the
month of February and April. Therefore provision should be made
for the payment of ₹ 40,000 and ₹ 25,000 for the same. An
application has been made to the Bank for grant of loan of ₹
30,000 and it is hoped that it will be received in the month of May.
It is anticipated that the dividend of ₹ 35,000 will be paid in June.
Debtors are allowed 1 months credit. Sales commission @ 2% on
Cash Sales and 5% on cash collection from Debtors is to be paid.
Creditors (for Goods or Overheads) grant one month credit.
Q.4) A) Solve.
Mr. A owns a bus which runs between Mumbai and Pune and
back for 10 days in a month. The distance from Mumbai to Pune is
200 kms. The bus completes the trip from Mumbai to Pune and
back on the same day. The bus goes another 10 days in the
month to Ratnagiri and the distance covered being 350 kms. The
trip also comoleted on the same day. For the rest of 4 days it runs
in the local city. Daily distance covered in local city is 100 kms.
Calculate the rate Mr. A should charge per trip from passenger
when he wants to earn a profit of 50% on cost.
The other particulars are given below :
Cost of Bus ₹ 9,00,000
Depreciation 20% per annum
Salary of Driver ₹ 6,000 per month
Salary of Conductor ₹ 5,000 per month
Salary of Accountant ₹ 2,000 per month
Diesel Consumption 6 kms. Per litre costing ₹
8.00per litre
Tax ₹ 9,600 per annum
Repairs ₹ 3,000 per month
Normal capacity of bus is 50 passengers
The bus is generally occupied 90% of the capacity when it goes to
Pune and 80% when it goes to Ratnagiri. It is always full when it
runs within city.
Or
B) Write short notes (Any Three)
