Set : 5

Q.1)
(a) Match the following correctly with what it relates:
Uniform costing Supervisors salaries
Variance analysis Decision making
Point rating Design of the product
Value engineering Technique to assist inter - rm comparison
Stepped cost o! evaluation
"ngineered cost
#anagement !y e$ception
#ethod of costing
(b) State whether the following statements are True (T) or False (F):
%i& 'f an e$pense can !e identied (ith a specic cost unit) it is treated as direct e$pense*
%ii& Time and motion study (hich is a function of the engineering department) is useless for the
determination of (ages*
%iii& +i$ed costs vary (ith volume rather than time*
%iv& The relationship of value) function and cost can !e e$pressed as, -ost . Value/+unction**
%v& +uture costs are not relevant (hile making management decisions*
%vi& 'n !reak-even analysis it is assumed that varia!le costs 0uctuate inversely (ith volume*
(c) In the following cases one of the answers is correct. hoose the correct answer an! gi"e your
wor#ings$reasons brie% y:
%i& 1 company maintains a margin of safety of 234 on its current sales and earns a prot of 5s* 67
lakhs per annum* 'f the company has a prot volume %P/V& ratio of 874) its current sales amount to 1,
5s* 277 lakhs
9, 5s* 677 lakhs
-, 5s* 623 lakhs
D, none of the a!ove*
%ii& 'n a factory of P"" :td* (here standard costing is follo(ed) the !udgeted $ed overheads for a
!udgeted production of 8);77 units is 5s* 28)777* +or a certain period actual e$penditure
incurred (as 5s* 22)777 resulting in a $ed overhead volume variance of 5s* 6)777 %1dv*&*
Then actual production for the period (as
1, 3)877 units
9, 8)277 units
-, 6)777 units
D, none of the a!ove*
%iii& <"" :td* uses material 1 for the production of product #* The safety stock of material 1 is 677
units, the supplier quotes a delivery delay of t(o or three (eeks* 'f the company uses 377 to ;77
units a (eek according to the activity levels) the re - order level of material 1 (ill !e
1, 2)677 units
9, 2)877 units
-, 2)=77 units
D, 2);77 units
&ns.1)
(a) Match the following correctly with what it relates:
Uniform costing Technique to assist inter rm comparison
Variance analysis #anagement !y e$ception
Point rating o! evaluation
Value engineering Design of the product
Stepped cost Supervisors salaries
(b) %i& > True? %ii& > +alse? %iii& > +alse? %iv& > +alse? %v& > +alse? %vi& > +alse*
(c) %i& > 9 , 5s* 677 lacs
%ii& > 9 , 8)277 units
%iii& > - , 2)=77 units