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Assignment I
Attempt all the questions. All questions are compulsory and carry equal marks.
Section A
1. (a) What are two basic financial statements? Explain their importance to the various uses?
(b) Why is reconciliation of cost and financial account necessary? State the reasons for difference
between profits shown by both the accounts.
2. (a) Define overtime. How can overtime be controlled? What is his accounting treatment?
(b) Given the meaning and treatment of scrap, waste, spoilage and defective?
3. (a) What is meant by under-absorption and over-absorption of overhead? How will you account for
them in cost account?
(b) Distinguish between job costing and contract costing?
M/s. Raj Oil Mills produce four products. The total cost of inputs during the year ending 31-03-2010 is Rs.
148000.00. The output, sales and additional Processing cost are as under:-
Products A B C D
Outputs(in liters) 8000 4000 4000 2000
Page No. 1 of 4
Additional processing cost (after split off) 45000.00 12000.00 1000.00 ------
Sales value 176500.00 18000.00 44000.00 8000.00
In case these products were disposed off at the split off point that is before further processing, the selling
price (per liters) would have been
A B C D
16.00 6.00 8.00 4.00
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FM11
Assignment II
Attempt all the questions. All questions are compulsory and carry equal marks.
Section A
1. (a) “The Break-even analysis is a useful device of profit planning” Do you agree? Discuss.
(b) Explain the assumptions, utility and limitations of the Cost-Volume-Profit analysis.
3. (a) Explain briefly profitability Index ? How does it differ from net present value method?
(b) What are the mutually exclusive projects? Explain the conditions when conflicting ranking would be given
by the NPV and IRR method of such projects?
Section B
5. Case Study
M/s. Raj Ltd. is having an installed capacity of 100000 units of a product. It is currently operating at 70%
capacity utilization. The capacity utilization and cost per unit is mentioned below.
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The Company has received three offer of export from three different sources as under:-
Source X : 5000 units at rupees 55 per unit
Source Y : 10000 units at rupees 52 per unit
Source Z : 10000 units at rupees 51 per unit.
Advice the company as to whether any or all the export orders should be accepted or not.
Page No. 4 of 4