Cost and Management Accounting - September 2025

(a) RST Ltd. manufactures a standard line of office desks. The company operates with a monthly manufacturing capacity of 5,000 units. The following data relates to the output and cost of two consecutive months of production: Units Manufactured Direct Material (`) Direct Wages (`) Factory Overheads (`) April 3,000 15,00,000 6,00,000 3,50,000 3,800 19,00,000 7,60,000 4,30,000 Month In the month of June, the number of units manufactured will be 4,000 units. However, the prices of direct material will increase by…

Toll Plaza Limited operates a toll plaza on a 100 km highway and collects tolls from vehicles passing through the plaza. The company has estimated that every year a total of ` 60 lakh vehicles (60% Passenger vehicles, 15% Heavy Commercial Vehicles and rest are Buses) will be using the highway during the 15 years toll collection tenure. Toll Operating and Maintenance cost for the month (30 days in a month) are as follows: (1) Personnel Costs (Salaries): Collection Personnel…

(a) A consultancy firm provides project management service in three sectors Technology, Healthcare and Education. The Project management service covers development and implementation of software for various MIS requirements of its clients. The fees charged per project is as follows: Technology: ` 90,000 Healthcare: ` 1,20,000 Education: ` 1,10,000 The company uses Activity-Based Costing (ABC) to allocate its overhead costs. For the month of August 2025, the following informations are provided: Service Sector Number of Software Projects Development Hours Consulting…

(a) SVS Limited manufactures a single product 'Al'. The company has estimated its quarter-wise sales for the next year as follows: Quarter Sales (Units) I 72,000 90,000 99,000 1,08,000 In the beginning of the year, the opening stock of finished goods is 14,400 units and the company expects to maintain the closing stock of finished goods at 29,400 units at the end of the year. The production pattern in each quarter is based on 80% of the sales of the…

(a) TS Limited is suffering from material deterioration and finds that their valuable stocks are not properly stored. The company furnishes following information: Serial No. Material Name Units Total Cost (`) 1 54,105 14,855 2 32,300 12,823 3 28,600 13,972 4 10,250 47,685 5 23,410 39,015 6 2,580 1,08,260 7 8,900 89,410 8 4,855 98,980 Store-keeper of the company argues that he has taken proper care in storing three types of material named MA, MB and MC as they are…

Define Responsibility Centre and discuss the types of Responsibility Centres. (5 Marks) (b) List the advantages of Job Costing. (5 Marks) (c) List the important factors which need consideration for controlling employee costs. (4 Marks) 26 COST AND MANAGEMENT ACCOUNTING (c) Discuss the uses of Bill of Material in the following departments: (i) Marketing (Purchase) Department (ii) Production Department (iii) Stores Department (iv) Cost/Accounting Department (4 Marks) (a) As the organization grows, its functions, organisational structure and other related functions…