CA Inter Cost & Mgmt — Revision Test Paper (RTP) — May 2026

Case: ABC Enterprises is a well-established trading firm specialised in the distribution and sale of a diverse range of products, with a commitment to deliver superior quality to its customers. (a) The company is engaged in both cash and credit sales, with credit sales being twice of cash sales. Cash sales are eligible for 3% discount. (b) 60% of credit sales are collected within the same month of sale. The remaining 40% is collected in the following month. All receivables are expected to be fully recovered, with no bad debts anticipated. (c) The company employs a structured pricing policy, ensurin…

What is the net cash sales (after discount) for the month of February 2025?

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Case: ABC Enterprises is a well-established trading firm specialised in the distribution and sale of a diverse range of products, with a commitment to deliver superior quality to its customers. (a) The company is engaged in both cash and credit sales, with credit sales being twice of cash sales. Cash sales are eligible for 3% discount. (b) 60% of credit sales are collected within the same month of sale. The remaining 40% is collected in the following month. All receivables are expected to be fully recovered, with no bad debts anticipated. (c) The company employs a structured pricing policy, ensurin…

What is the amount of total collection from debtors for the month of March 2025?

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Case: ABC Enterprises is a well-established trading firm specialised in the distribution and sale of a diverse range of products, with a commitment to deliver superior quality to its customers. (a) The company is engaged in both cash and credit sales, with credit sales being twice of cash sales. Cash sales are eligible for 3% discount. (b) 60% of credit sales are collected within the same month of sale. The remaining 40% is collected in the following month. All receivables are expected to be fully recovered, with no bad debts anticipated. (c) The company employs a structured pricing policy, ensurin…

What is the amount of credit purchases for the month of February 2025?

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Case: ABC Enterprises is a well-established trading firm specialised in the distribution and sale of a diverse range of products, with a commitment to deliver superior quality to its customers. (a) The company is engaged in both cash and credit sales, with credit sales being twice of cash sales. Cash sales are eligible for 3% discount. (b) 60% of credit sales are collected within the same month of sale. The remaining 40% is collected in the following month. All receivables are expected to be fully recovered, with no bad debts anticipated. (c) The company employs a structured pricing policy, ensurin…

What is the amount of payment to creditors for the month of March 2025?

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Case: ABC Enterprises is a well-established trading firm specialised in the distribution and sale of a diverse range of products, with a commitment to deliver superior quality to its customers. (a) The company is engaged in both cash and credit sales, with credit sales being twice of cash sales. Cash sales are eligible for 3% discount. (b) 60% of credit sales are collected within the same month of sale. The remaining 40% is collected in the following month. All receivables are expected to be fully recovered, with no bad debts anticipated. (c) The company employs a structured pricing policy, ensurin…

What is the amount of closing cash in hand as on 31st March, 2025?

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Case: White Kollars Pvt. Ltd. is a company engaged solely in the manufacture of shirts. Currently, the company sells its products directly to the retailers. Sales has steadily declined due to rising competition. The management believes that a profit of ₹ 60,00,000 is necessary to ensure an adequate return on capital. Profit and Loss Account for last year (Amount in '000): Sales revenue – 50,000 shirts at ₹ 1,500 each: ₹ 75,000 Factory cost of goods sold: Direct materials ₹ 7,500; Direct labour ₹ 26,250; Variable factory overheads ₹ 4,500; Fixed factory overheads ₹ 16,500; Total ₹ 54,750 Fixed Admin…

P/V ratio and Break-even sales (in value) based on the last year accounts would be:

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Case: White Kollars Pvt. Ltd. is a company engaged solely in the manufacture of shirts. Currently, the company sells its products directly to the retailers. Sales has steadily declined due to rising competition. The management believes that a profit of ₹ 60,00,000 is necessary to ensure an adequate return on capital. Profit and Loss Account for last year (Amount in '000): Sales revenue – 50,000 shirts at ₹ 1,500 each: ₹ 75,000 Factory cost of goods sold: Direct materials ₹ 7,500; Direct labour ₹ 26,250; Variable factory overheads ₹ 4,500; Fixed factory overheads ₹ 16,500; Total ₹ 54,750 Fixed Admin…

Profit/(Loss) from proposal (i) would be:

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Case: White Kollars Pvt. Ltd. is a company engaged solely in the manufacture of shirts. Currently, the company sells its products directly to the retailers. Sales has steadily declined due to rising competition. The management believes that a profit of ₹ 60,00,000 is necessary to ensure an adequate return on capital. Profit and Loss Account for last year (Amount in '000): Sales revenue – 50,000 shirts at ₹ 1,500 each: ₹ 75,000 Factory cost of goods sold: Direct materials ₹ 7,500; Direct labour ₹ 26,250; Variable factory overheads ₹ 4,500; Fixed factory overheads ₹ 16,500; Total ₹ 54,750 Fixed Admin…

With respect to proposal (i), how many number of units White Kollars Pvt. Ltd. would need to sell at ₹ 1,350 each to earn a desired profit of ₹ 60,00,000?

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Case: White Kollars Pvt. Ltd. is a company engaged solely in the manufacture of shirts. Currently, the company sells its products directly to the retailers. Sales has steadily declined due to rising competition. The management believes that a profit of ₹ 60,00,000 is necessary to ensure an adequate return on capital. Profit and Loss Account for last year (Amount in '000): Sales revenue – 50,000 shirts at ₹ 1,500 each: ₹ 75,000 Factory cost of goods sold: Direct materials ₹ 7,500; Direct labour ₹ 26,250; Variable factory overheads ₹ 4,500; Fixed factory overheads ₹ 16,500; Total ₹ 54,750 Fixed Admin…

With respect to proposal (ii), how much selling price per unit should be offered to eFlip, that would at least break even on this proposal?

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Case: White Kollars Pvt. Ltd. is a company engaged solely in the manufacture of shirts. Currently, the company sells its products directly to the retailers. Sales has steadily declined due to rising competition. The management believes that a profit of ₹ 60,00,000 is necessary to ensure an adequate return on capital. Profit and Loss Account for last year (Amount in '000): Sales revenue – 50,000 shirts at ₹ 1,500 each: ₹ 75,000 Factory cost of goods sold: Direct materials ₹ 7,500; Direct labour ₹ 26,250; Variable factory overheads ₹ 4,500; Fixed factory overheads ₹ 16,500; Total ₹ 54,750 Fixed Admin…

Profit/(Loss) from proposal (iii) would be:

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In two consecutive quarters, a company reported the following performance: Quarter 1 sales were ₹ 2,10,000 with a profit of ₹ 12,000, while Quarter 2 sales rose to ₹ 2,40,000 with a profit of ₹ 24,000. Assume that the fixed cost remained constant across both quarters and that the company did not introduce any new product lines. Based on the above information, the P/V ratio must be:

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In a chemical processing unit, materials are added at the beginning of the process. During the month, the department reported 9,200 equivalent units of production (EUP) under the FIFO method. The process had an opening WIP of 800 units, which were 50% complete, and a closing WIP of 900 units, which were 70% complete with respect to conversion costs. During the month, the plant also faced a minor machine breakdown, but it did not affect the material input, only the processing speed. Based on the above information, the number of units completed during the month was:

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In a manufacturing enterprise, two joint products, X and Y, emerge simultaneously from a common production process. The company incurs joint costs up to the split-off point, after which the products become separately identifiable. For the previous month, the following details relating to production and inventory are available: Product X: Sales 96,000 units; Opening Stock 2,400 units; Closing Stock 6,000 units Product Y: Sales 64,000 units; Opening Stock 4,800 units; Closing Stock 2,400 units The total joint production cost incurred during the month amounted to ₹ 18,60,000. These joint costs are apportioned between products X and Y in proportion to the number of units produced. Determine the amount of joint production cost to be allocated to Product X for the month.

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Hari Udyog is a small-scale manufacturing unit producing a single product X using two raw materials PK and BK in the input ratio of 3:2. The input–output ratio in production is 5:3. Raw material PK is perishable and becomes obsolete if not used within 5 days of purchase, whereas raw material BK is durable and can be stored for more than one year. Material PK is procured locally with a lead time of 1 to 2 days, while material BK is purchased from a neighbouring state and takes 2 to 4 days. The estimated sales volume for April 2025 is 30,000 kg, and the same level of sales is expected to continue throughout the year. The company operates for 25 days a month, and production is carried out evenly. Purchase price per kg (excluding taxes): PK – ₹ 15; BK – ₹ 22. Administrative cost to place an order: ₹ 120 per order. Annual carrying cost: 15% of value for PK and 5% for BK. Currently, material PK is purchased in lots of 8,000 kg to avail a 10% trade discount on the market price. GST at 5% is applicable on material PK, for which input tax credit is available. Material BK is subject to 2% CST, for which no input tax credit is available. You are required to calculate:

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Rivaan Industries manufactures and sells wooden study tables. At present, Rivaan Industries pays wages under a piece-rate system, with a standard piece rate of ₹ 18 per table produced. Company policy for payment under the piece-rate system: • For efficiency less than 100%: Workers are paid 80% of the standard piece rate. • For efficiency equal to or more than 100%: Workers are paid 125% of the standard piece rate. The standard output per hour is 3 tables. Each worker works 9 hours per day from Monday to Friday and 4 hours on Saturday. A total of 132 workers are currently eligible for this wage plan. Workers have demanded a shift to a time-rate wage system at ₹ 65 per hour, along with incentives under the Halsey Premium Plan (50% sharing of time saved). Production Estimates for January 2026: Worst Case: 36,900 units; Optimal Case: 73,800 units; Best Case: 1,10,700 units. In addition, a Technology Upgrade Case involving partial automation is being assessed, which may influence both output levels and worker productivity. (Assume 4 working weeks in a month.)

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Omega Engineering Pvt. Ltd. operates three major CNC machines (X, Y, and Z) in its machining department. The management has provided the following annual cost data: Preliminary Estimates of Annual Expenses: Depreciation: Total ₹ 3,00,000 (X: ₹ 1,20,000; Y: ₹ 1,00,000; Z: ₹ 80,000) Spare parts: Total ₹ 1,50,000 (X: ₹ 60,000; Y: ₹ 50,000; Z: ₹ 40,000) Power: Total ₹ 5,50,000 (apportioned by KW rating) Consumable stores: Total ₹ 1,20,000 (X: ₹ 50,000; Y: ₹ 40,000; Z: ₹ 30,000) Insurance of machinery: Total ₹ 1,00,000 Indirect labour: Total ₹ 2,40,000 Building maintenance: Total ₹ 2,50,000 Annual interest on capital outlay: Total ₹ 1,20,000 (X: ₹ 50,000; Y: ₹ 40,000; Z: ₹ 30,000) Additional monthly information: Rent & rates: ₹ 30,000 per month Salary of Production Supervisor: ₹ 60,000 per month Salary of Machine Operator: ₹ 18,000 per month (The supervisor and operator oversee all three machines and spend equal time on each.) Machine details: Machine X: Estimated Direct Labour Hours 1,20,000; KW Rating 4; Floor Space 50,000 sq. ft. Machine Y: Estimated Direct Labour Hours 1,60,000; KW Rating 3; Floor Space 40,000 sq. ft. Machine Z: Estimated Direct Labour Hours 1,40,000; KW Rating 2; Floor Space 30,000 sq. ft. Working Conditions: • The plant operates 8 hours per day. • Saturdays are half-days. • There are 15 holidays besides Sundays, of which 3 fall on Saturdays. • Machines run at 92% capacity. • A 3% allowance for breakdown is considered reasonable. Management expects the following increases for the coming financial year: 1. 10% increase in spare parts prices. 2. 30% increase in spare parts consumption for Machines Y & Z only. You are required to CALCULATE the predetermined machine hour rates for Machines X, Y, and Z after incorporating all the revisions.

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A XYZ company supplies and maintains a range of printers for business customers. The service department provides after-sales support including routine preventive maintenance and repair services. Customers are charged a fee per print. There is one customer per machine. The company's existing cost system uses a single overhead rate based on total sales revenue from print charges. The company's accountant has decided to implement an ABC system. Activity cost data (overheads per annum): Customer account handling (No. of Customers): ₹ 1,26,000 Planned maintenance scheduling (No. of planned maintenance visits): ₹ 4,80,000 Unplanned maintenance scheduling (No. of unplanned maintenance visits): ₹ 1,47,000 Spare part procurement (No. of purchase orders): ₹ 2,43,000 Other overheads (No. of machines): ₹ 6,00,000 Total overheads: ₹ 15,96,000 Machine data: Desktop Inkjet Printers: Charge per copy ₹ 0.03; Avg copies/year/machine 60,000; No. of machines 300; Planned maintenance visits/machine/year 4; Unplanned visits 1; Total purchase orders/year 500; Parts cost/visit ₹ 100; Labour cost/visit ₹ 60 Office Laser Printers (colour): Charge per copy ₹ 0.04; Avg copies/year/machine 1,20,000; No. of machines 800; Planned visits 6; Unplanned visits 1; Total purchase orders/year 1,200; Parts cost/visit ₹ 300; Labour cost/visit ₹ 80 High-Volume Production Printers: Charge per copy ₹ 0.05; Avg copies/year/machine 1,80,000; No. of machines 500; Planned visits 12; Unplanned visits 2; Total purchase orders/year 1,000; Parts cost/visit ₹ 400; Labour cost/visit ₹ 100

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Following information is available from the books of YSPP Ltd. for the current year ending 31st March: (i) Raw materials purchased: ₹ 35,00,00,000 (ii) Freight inwards: ₹ 39,22,100 (iii) Wages paid to factory workers: ₹ 1,02,20,000 (iv) Contribution made towards employees' PF & ESIS: ₹ 12,60,000 (v) Hire charges paid for hiring specific equipment: ₹ 8,40,000 (vi) Amount paid for power & fuel: ₹ 16,17,000 (vii) Amount paid for purchase of moulds and patterns (life equivalent to four years production): ₹ 31,36,000 (viii) Job charges paid to job workers: ₹ 28,42,000 (ix) Lease rent paid for production assets: ₹ 3,92,000 (x) Depreciation on: Factory building ₹ 2,94,000; Office building ₹ 1,96,000; Plant & Machinery ₹ 4,41,000; Delivery vehicles ₹ 3,01,000; Total ₹ 12,32,000 (xi) Salary paid to supervisors: ₹ 4,41,000 (xii) Repairs & Maintenance paid for: Plant & Machinery ₹ 1,68,000; Sales office building ₹ 63,000; Total ₹ 2,31,000 (xiii) Insurance premium paid for: Plant & Machinery ₹ 1,09,200; Factory building ₹ 63,350; Stock of raw materials & WIP ₹ 1,26,000; Total ₹ 2,98,550 (xiv) Expenses paid for quality control check activities: ₹ 68,600 (xv) Salary paid to quality control staffs: ₹ 3,36,700 (xvi) Research & development cost paid for improvement in production process: ₹ 63,700 (xvii) Expenses paid for administration of factory work: ₹ 4,15,100 (xviii) Salary paid to functional managers: Production control ₹ 33,60,000; Finance & Accounts ₹ 32,13,000; Sales & Marketing ₹ 35,42,000; Total ₹ 1,01,15,000 (xix) Salary paid to General Manager: ₹ 43,96,000 (xx) Packing cost paid for: Primary packing necessary to maintain quality ₹ 3,36,000; For re-distribution of finished goods ₹ 3,92,000; Total ₹ 7,28,000 (xxi) Fee paid to auditors: ₹ 6,30,000 (xxii) Fee paid to independent directors: ₹ 7,70,000 (xxiii) Value of stock as on 1st April (beginning): Raw materials ₹ 63,00,000; Work-in-process ₹ 32,20,000; Finished goods ₹ 38,50,000; Total ₹ 1,33,70,000 (xxiv) Value of stock as on 31st March (ending): Raw materials ₹ 33,60,000; Work-in-process ₹ 30,45,000; Finished goods ₹ 63,00,000; Total ₹ 1,27,05,000 Due to delay in picking up cargo from the port, YSPP Ltd. had to pay ₹ 15,000 as demurrage in the month of March. From the above data you are required to PREPARE Statement of cost for YSPP Ltd. for the year ended 31st March, showing (i) Prime cost, (ii) Factory cost, (iii) Cost of Production, (iv) Cost of sales.

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The following figures have been extracted from the cost records of a manufacturing unit: Stores: Opening balance ₹ 32,000; Purchases of material ₹ 1,58,000; Transfer from work-in-progress ₹ 80,000; Issues to work-in-progress ₹ 1,60,000; Issues to repair and maintenance ₹ 20,000; Deficiencies found in stock taking ₹ 6,000. Work-in-progress: Opening balance ₹ 60,000; Direct wages applied ₹ 65,000; Overheads applied ₹ 2,40,000; Closing balance of WIP ₹ 45,000. Finished products: Entire output is sold at a profit of 10% on actual cost from work-in-progress. Wages incurred ₹ 70,000; Overhead incurred ₹ 2,50,000. Items not included in cost records: Income from investment ₹ 10,000; Loss on sale of capital assets ₹ 20,000. Draw up Store Control account, Work-in-progress Control account, Costing Profit and Loss account, Profit and Loss account and Reconciliation statement.

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The Northshire Hospital Trust operates two types of specialist X-ray scanning machine, XR1 and XR50. Details for the next period are estimated as follows: Machine XR1: Running hours 1,100; Variable running costs (excluding plates) ₹ 27,500; Fixed costs ₹ 20,000 Machine XR50: Running hours 2,000; Variable running costs (excluding plates) ₹ 64,000; Fixed costs ₹ 97,500 A brain scan is normally carried out on machine type XR1: this task uses special X-ray plates costing ₹ 40 each and takes four hours of machine time. Because of the nature of the process, around 10 per cent of the scans produce blurred and therefore useless results.

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A Company produces a component, which passes through two processes. During the month of April, 2025, materials for 40,000 components were put into Process I of which 30,000 were completed and transferred to Process II. Those not transferred to Process II were 100% complete as to materials cost and 50% complete as to labour and overheads cost. Process I costs incurred: Direct Materials: ₹ 15,000 Direct Wages: ₹ 18,000 Factory Overheads: ₹ 12,000 Of those transferred to Process II, 28,000 units were completed and transferred to finished goods stores. There was a normal loss with no salvage value of 200 units in Process II. There were 1,800 units remained unfinished in the process with 100% complete as to materials and 25% complete as regard to wages and overheads. No further process material costs occur after introduction at the first process until the end of the second process, when protective packing is applied to the completed components. Process II costs incurred at the end: Packing Materials: ₹ 4,000 Direct Wages: ₹ 3,500 Factory Overheads: ₹ 4,500

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ABC Ltd. operates a simple chemical process to convert a single material into three separate items, referred to as X, Y and Z. All three end products are separated simultaneously at a single split-off point. Product X and Y are ready for sale immediately upon split off without further processing or additional costs. Product Z, however, is processed further before being sold. There is no available market price for Z at the split-off point. During 2024-25: X – 186 tons sold for ₹ 3,000 per ton Y – 527 tons sold for ₹ 2,250 per ton Z – 736 tons sold for ₹ 1,500 per ton Total joint manufacturing costs for the year: ₹ 12,50,000 Additional cost to finish product Z: ₹ 6,20,000 There were no opening inventories. The following inventories of complete units were on hand at year end: X: 180 tons; Y: 60 tons; Z: 25 tons There was no opening or closing work-in-progress. COMPUTE the cost of inventories of X, Y and Z and cost of goods sold for year ended March 31, 2025, using Net Realizable Value (NRV) method of joint cost allocation.

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BabyMoon Ltd. uses standard costing system in manufacturing one of its product 'Baby Cap'. The standard cost details are: Direct Material: 1 Meter @ ₹ 60 per meter = ₹ 60 Direct Labour: 2 hours @ ₹ 20 per hour = ₹ 40 Variable overhead: 2 hours @ ₹ 10 per hour = ₹ 20 Total standard cost: ₹ 120 During the month of August, 10,000 units of 'Baby Cap' were manufactured. Actual details: Direct material consumed: 11,400 meters @ ₹ 58 per meter Direct labour hours: ? @ ? = ₹ 4,48,800 Variable overhead incurred: ₹ 2,24,400 Variable overhead efficiency variance is ₹ 4,000 Adverse. Variable overheads are based on Direct Labour Hours. You are required to CALCULATE the following Variances:

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Fit'n'fine Ltd. runs a fitness club in Delhi. It offers three types of membership plans: Bronze, Silver, and Gold. Cost Information: Rent: ₹ 1,00,000 per month Gym equipments: ₹ 30,00,000 (service life 5 years) Licenses & Permits: ₹ 86,000 (renewed every six months) Insurance: ₹ 12,000 per annum Salary to the instructors: ₹ 7,48,000 per annum Utilities: ₹ 75,000 per quarter Cleaning supplies: ₹ 1,44,000 per annum AMC of equipments & machinery: ₹ 1,20,000 per month Marketing expenses: ₹ 3,00,000 per annum Electricity expenses @ ₹ 14 per unit: April to July – 60 units per hour; August to March – 25 units per hour Membership Details (Club access time and occupancy %): Gold: 5:00 AM to 9:00 AM; April–July 100%; August–March 80% Silver: 6:00 PM to 9:00 PM; April–July 70%; August–March 50% Bronze: 9:00 AM to 6:00 PM; April–July 50%; August–March 30% Maximum capacity of the fitness club is 200 persons in any time slot. The membership fee per month for Gold members is to be fixed at 1.5 times of the Silver membership and that of Silver membership as twice of the Bronze membership fee after providing profit @ 25% on membership fees. The club opens 25 days in a month. You are required to calculate the membership fee per month to be charged by the club for each member type.

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Miscellaneous questions on cost concepts and treatment of scrap and defectives.

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