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Past papers › Cost & Mgmt › May 2024

CA Inter Cost & Mgmt — Revision Test Paper (RTP) — May 2024

This page contains all 6 questions from the CA Inter Cost & Management Accounting Revision Test Paper (RTP) for the May 2024 attempt cycle, sourced from VSI Jaipur.

Q8Process costing – FIFO method, equivalent production, abnorm
0 marks easy
The following data are available in respect of Process-I for January 2024: (1) Opening stock of work in process: 600 units at a total cost of Rs.4,200. (2) Degree of completion of opening work in process: Material 100%; Labour 60%; Overheads 60%. (3) Input of materials at a total cost of Rs.55,200 for 9,200 units. (4) Direct wages incurred: Rs.18,600. (5) Overheads: Rs.8,630. (6) Units scrapped: 200 units. Stage of completion of scrapped units: Materials 100%; Labour 80%; Overheads 80%. (7) Closing work in process: 700 units. Stage of completion: Material 100%; Labour 70%; Overheads 70%. (8) 8,900 units were completed and transferred to the next process. (9) Normal loss is 4% of the total input (opening stock plus units put in). (10) Scrap value is Rs.6 per unit.
Q9Service costing – vehicle operating cost per month, CNG vs.
0 marks easy
A LMV Pvt. Ltd. operates cab/car rental service in Delhi/NCR. It provides its service to the offices of Noida, Gurugram and Faridabad. At present it operates CNG fuelled cars but it is also considering to upgrade these into Electric vehicle (EV). The following details related with the owning of CNG & EV propelled cars are tabulated below: CNG Car / EV Car: Car purchase price: Rs.9,20,000 / Rs.15,20,000 Govt. subsidy on purchase of car: Nil / Rs.1,50,000 Life of the car: 15 years / 10 years Residual value: Rs.95,000 / Rs.1,70,000 Mileage: 20 km/kg / 240 km per charge Electricity consumption per full charge: -- / 30 Kwh CNG cost per Kg: Rs.60 / -- Power cost per Kwh: -- / Rs.7.60 Annual Maintenance cost: Rs.8,000 / Rs.5,200 Annual insurance cost: Rs.7,600 / Rs.14,600 Tyre replacement cost every 5 years: Rs.16,000 / Rs.16,000 Battery replacement cost every 8 years: Rs.12,000 / Rs.5,40,000 Additional information (common to both): Average distance covered by a car in a month: 1,500 km Driver's salary: Rs.20,000 p.m. Garage rent per car: Rs.4,500 p.m. Share of Office & Administration cost per car: Rs.1,500 p.m. CALCULATE the operating cost of vehicle per month per car for both CNG & EV options.
Q10Standard costing – material price, quantity and cost varianc
0 marks easy
EML operates in coal mining through open cast mining method. Explosives and detonators are used for excavation of coal from the mines. The following are the details of standard quantity of explosives materials used for mining: SME: Rate Rs.40.00 per kg; Standard Qty for Coal: 2.4 kg per tonne; Standard Qty for Overburden (OB): 1.9 kg per cubic-meter Detonators: Rate Rs.20.00 per piece; Standard Qty for Coal: 2 pcs per tonne; Standard Qty for Overburden (OB): 2 pcs per cubic-meter The standard stripping ratio is 3:1 (3 cubic-meter of overburden soil to be removed to get one tonne of coal). During the month of December 2023, the company produced 20,000 tonnes of coal and 58,000 cubic-meter of OB. The quantity of explosive materials used and paid for the month: SME: Quantity 1,67,200 kg; Amount Rs.63,53,600 Detonators: Quantity 1,18,400 pcs; Amount Rs.24,27,200 Explosive suppliers are paid on the basis of performance of the explosives (powder factor). You being a bill passing officer of EML are required to COMPUTE the material price variance, material quantity variance and material cost variance.
Q11Marginal costing – BEP, profit, margin of safety
0 marks easy
The analysis of cost sheet of A Ltd. for the last financial year has revealed the following information for its product R: Elements of Cost / Variable Cost portion / Fixed Cost: Direct Material: 30% of cost of goods sold / -- Direct Labour: 15% of cost of goods sold / -- Factory Overhead: 10% of cost of goods sold / Rs.2,30,000 General & Administration Overhead: 2% of cost of goods sold / Rs.71,000 Selling & Distribution Overhead: 4% of cost of sales / Rs.68,000 Last year 5,000 units were sold at Rs.185 per unit.
Q12Flexible revenue budget preparation – PSU
0 marks easy
M Ltd. is a public sector undertaking (PSU) that produces a product A. The company is in process of preparing its revenue budget for the year 2024. The following information is available: (i) Anticipated 12% growth in sales volume from the year 2023 level of 4,20,000 tonnes. (ii) The sales price of Rs.23,000 per tonne will be increased by 10% provided Wholesale Price Index (WPI) increases by 5%. (iii) To produce one tonne of product A, 2.3 tonnes of raw material are required. Raw material cost is Rs.4,500 per tonne. The price will also increase by 10% if WPI increases by 5%. (iv) The projected increase in WPI for 2024 is 4%. (v) A total of 6,000 employees work for the company. The company works 26 days in a month. (vi) 85% of employees are permanent, getting salary as per 5-year wage agreement. Earnings per manshift is Rs.3,000 (excluding terminal benefits). The new wage agreement will be implemented from 1st July 2024 with an expected 15% increase in pay. (vii) Casual employees get a daily wage of Rs.850 linked to Consumer Price Index (CPI). Present CPI is 165.17 points and expected to be 173.59 points in 2024. (viii) Power cost for year 2023 is Rs.42,00,000 for 7,00,000 units (1 unit = 1 Kwh). 60% of power is used for production (directly related to production volume) and remaining for employee quarters and administrative offices. (ix) During 2023, the company paid Rs.60,00,000 for safety and maintenance works. The amount will increase in proportion to production volume. (x) During 2023, the company paid Rs.1,20,000 for diesel used in car hired for administrative purposes. The cost of diesel will increase by 15% in 2024. (xi) During 2023, the company paid Rs.6,00,000 for car hire charges (excluding fuel cost). In 2024, the company has decided to reimburse the diesel cost to the car rental company. This will attract 5% GST on Reverse Charge Mechanism (RCM) basis on which the company will not get GST input credit. (xii) Depreciation on fixed assets for 2023 is Rs.80,40,00,000 and it will be 15% lower in 2024. PREPARE Revenue (Flexible) budget for the year 2024 and also show the budgeted profit/loss for the year.