Share Cost-Final-Exam-27062020-114439pm

BAHRIA UNIVERSITY (KARACHI CAMPUS)
Final Assessment Assignment Spring 2020

Course Code / Title: Cost Accounting Class:BBA(4)-4(All Sectons)
Course Instructor: M. Asif / Dr. Danish / Zulfiqar / Marks: 50
Abdulghaffar / Nabeel
Assignment Upload Date and Time by the Teacher: July, 3, 2020. 8:00 AM
Assignment Completion / Upload Date and Time by the Student: July, 3, 2020. 4:00 PM
Student’s Name: ___________________ Reg. No: _________
Assignment Guidelines by the Teacher
 Assignment Submission: Hand Written only.

 Sharing-similarity comes under use of unfair means, if found in response assignment by the students, it shall be
dealt with in accordance with BU examination rules.
 Show complete supporting working.
Question: 1
All-win Engineering limited uses Process Costing system. Following data is available for Department:-1 for
the month of May, 2020:
Quantitative data:
Beginning work in process inventory …………………………………… 5,000 units
Units put into process during the month ………………………………… 55,000 units
Units completed and transferred to department: 2 during the month ……. 52,000 units
Units in work in process closing inventory at month end ………………. 5,000 units
Cost data:
 Units in beginning work-in-process inventory contains Cost, as follows:
Direct materials......................................................................................... Rs 36,000
Direct labor............................................................................................... 38,000
Factory overhead....................................................................................... 42,000
 Costs added during the month are as follows:

Direct materials consumed ……………………………………………… Rs280,400
Direct labor incurred ……………………………………………………. 321,125
Factory overhead applied ………………………………………………. 339,225
Other statistical data:

 Work in process opening inventory is completed 75% as per direct material and 60% as per conversion
cost.
 Work in process closing inventory is completed 80% as per direct material and 65% as per conversion
cost.
 All losses are normal and occurred at the beginning of the month.
Required:
i).Prepare the Cost of Production Report for Department: 1 for the month of May, 2020, if company uses
“Weighted Average costing system”.
Marks: 8
ii). Distinguish between process costing and job order costing, and give at least three examples for each
one.
Marks: 2
….. .. …….
Question: 2
Imtiaz Super Store sells Blue Band Margarines. Its annual demand is 108,500 units. The shop incurs ordering
cost of Rs 650/= order, irrespective of the order size. They buy it at Rs 150 per unit. The carrying cost is 12%
on average inventory investment plus rent, insurance, property tax, and supervision for each unit is Rs 3. The
maximum sale per day is 360 units. It takes 5 days to receive these items from supplier after placement of order
quantities. The annual working days of Store are 350 days.
Required:
i). Determine the Economic order quantities (EOQ)

Marks: 2
ii). Determine Safety stock maximum.
Marks: 1
iii). Determine Reorder point levels

Marks: 2
iv). Total annual inventory cost (Total annual ordering cost and total annual carrying cost)
Marks: 2
v). A Supplier offers 1% discount to Imtiaz Supper Store, if they purchase the goods at least at 10,000
units at a time instead of above EOQ level (Part-i). Should they accept this offer? Please advice to
management with relevant comparative workings.
Marks: 2
vi). Why Economic order quantities may be wrong some time for any particular item to purchase in a
given situation? Marks: 1
….. .. ……
Question: 3
Bolan Engineering limited produces Camp shaft for Millat Tractors limited. The standard production is 40 units
per hour with a Base wage of Rs. 300 per hour for the payment of wages to their workers for their Camp shaft
plant. The company employs 5 workers in Camp shaft plant.
Each worker worked 25 days @8 hours per day in the month of March, 2020.
The each worker produced the following actual production during the month of March, 2020:
Name of workers Actual Outputs

of each worker
“Units”
Muhammad Hassan 8,800
Muhammad Tayab 8,600
Zafar Junaid 9,000
Muhammad Ayuab 8,000
Marium khalid 7,500
Required:
i). A schedule showing total labor cost for each worker, labor cost per unit for each worker, and total
labor cost for Camp shaft Plant in the month of March, 2020 , if Company uses 80% Time saved., i.e.,
80% Bonus Plan.
Marks: 8
ii).From the three popular methods of labor remunerations. i.e., time rate system, pieces rate system and
incentive schemes, which system would you recommend to management of Bolan engineering limited as a
Cost and Management accountant? Give in support of recommended system with proper justifications
and advantages to management.
Marks: 2
….. .. …….
Question: 4
Berger Paint Pakistan limited produces three types of joint products, Silver paint, Golden paint and Diamond
paint.
During March, 2020, the following information was recorded:
Particulars Silver Paint Golden Paint Diamond Paint Total Costs

Joint materials costs - - - Rs 960,000
Joint direct costs 555,000
Joint factory costs 490,000
Separable costs Rs 150,000 Rs 170,000 Rs 190,000 550,000
Production units 2,100 liters 2,500 liters 2,800 liters 7,400 liters
Sales units 1,900 liters 2,200 liters 2,400 liters 6,500 liters
Selling price per liter Rs 375 Rs 490 Rs 580 -
Additional information:
There was no beginning inventory as on 01/03/2020.
Required:
i). Compute total cost and unit cost of each type of above product, using the Hypothetical market value
method. Marks: 6
ii). Compute closing inventory cost of each product and total inventory costs as on 31/03/2020. Marks: 2
iii). Define joint products and by-products. Also give logical justification to treat any one of joint
products as a By-product. Marks: 2
….. .. …….
Question: 5
Gul Ahmed Textile Mills limited has mainly four producing departments and three servicing departments. The
actual factory overhead cost and other related statistical data for the month of April, 2020 is as follows:
Total
Actual Number of
factory Area Steam Requisitions Production
Departments overhead consumed
expenses
Rs Square Pounds Numbers Direct

Yards labor
“hours”
Production departments:
Spinning 945,000 1,200 105,000 350 32,500
Weaving 900,500 1,600 125,000 275 34,500
Dyeing and Printing 730,000 1,350 150,000 230 36,400
Stitching 765,400 800 170,000 285 28,400
Service departments:
Maintenance shop 540,500 700 60,000 90 -
Boiler shop 575,200 650 -0- 95 -
Store Room 390,800 950 -0- 30 -
Total 4,847,400 7,250 610,000 1,355 -
======= ====== ======= ======
The order and bases for distribution of service departments’ factory overhead expenses to other departments are
as follows:
 Maintenance shop: Area in square yards
 Boiler shop: Steam consumption in pounds
 Store Room: Number of requisitions
Additional information:
The Company assigns service departments expenses to other service departments too, however, after
a service department’s expenses have been allocated, no expenses are assigned back to it.
Required
i). Schedule showing distribution of service departments’ factory overhead expenses based on the data
given above.
Marks: 7
ii).Factory overhead rates per direct labor hour for the above four producing departments.
Marks: 1
iii). The CEO of National tiles company limited has been very critical of the present products costing
methods whereby factory overhead is charged to the products on over all factory rate basis. You have
been appointed by him as a consultant (as you are doing BBA and studying presently cost accounting in
Bahria University) to suggest to management that how to calculate factory overhead rates in another way
and charge to products so that products costing may be reliable and agreeably.
Marks: 2
….. .. …….
■The end■
♠Wish you good look♠

Share Cost-Final-Exam-27062020-114439pm

Uploaded by

Copyright:

Available Formats

Share Cost-Final-Exam-27062020-114439pm

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Share Cost-Final-Exam-27062020-114439pm

Uploaded by

Copyright:

Available Formats

BAHRIA UNIVERSITY (KARACHI CAMPUS)

Final Assessment Assignment Spring 2020

Assignment Guidelines by the Teacher

 Assignment Submission: Hand Written only.

 Costs added during the month are as follows:

Other statistical data:

i). Determine the Economic order quantities (EOQ)

iii). Determine Reorder point levels

Name of workers Actual Outputs

Particulars Silver Paint Golden Paint Diamond Paint Total Costs

Rs Square Pounds Numbers Direct

You might also like