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Unique Paper Code 834

Revised 0 of 16

Management AccountingDecember 2024

B.Com (Hons) · 5 questions · 1 part still being checked

Duration: 3 HoursMaximum Marks: 90

Reworded by Kunji from the printed paper. The original paper belongs to the University of Delhi. See DU's question bank.

Before you start

Numbers and theory. 10 numerical parts and 7 theory parts. Numericals take longer to lay out, so give them your freshest time.
Pace. Two minutes a mark: about 36 minutes for each 18-mark question, with nothing spare in 3 hours. Pick your side of each OR before you start writing.
Keep score. Every part opens a worked answer checked against the books. Turn the key when you have revised it; the boxes at the top fill in, on this device.

1.

18 marks
· ~36 min

(a)Management accounting as an extension of the managerial aspects of cost accounting; cost and management accounting distinguishedasked 2×"Management accounting extends the managerial aspects of cost accounting." Explain this statement, and clearly distinguish management accounting from cost accounting.(9)

(b)Responsibility accounting: definition, explanation and pre-requisitesasked 2×Define responsibility accounting and explain it. For a company to introduce responsibility accounting, what are the pre-requisites?(9)

OR

(a)Is management accounting merely financial and cost accounting adapted to management's needs?asked 2×"Management accounting is nothing but financial and cost accounting adapted to what management requires." Critically examine this statement.(9)

(b)Responsibility accounting and the creation of responsibility centresasked 2×Explain the concept of responsibility accounting. For its effective implementation, discuss the creation of various types of responsibility centres.(9)

2.

18 marks
· ~36 min

(a)The key factor in budgetingasked 2×Write a short note on the Key Factor in Budgeting.(4)

(b)Quarterly and annual production budget with stock levelsasked 2×KV Limited makes and sells a single product. Its sales budget for the calendar year 2025, quarter by quarter, is as follows: The year is expected to begin with 5,000 units of finished products in inventory and to end…(14)

OR

Flexible budget of production cost at 1,40,000 units, with the behaviour of each costasked 2×A company's Budget Manager is preparing a flexible budget for the accounting year ahead. The company makes a single product, and the following information is provided: Direct material costs Rs.26 per unit. Direct labour…(18)

3.

18 marks
· ~36 min

Material cost, price, usage, mix and yield variancesasked 2×Rohit Limited., a manufacturing concern that has adopted standard costing, gives the following information for the month ended March 31, 2024: To produce 10 units of product Z, the standard mix is: Material A 300 kg. @…(18)

OR

(a)

Efficiency, activity and capacity ratiosBeing checked

(6)

(b)Sales value variances: total, price and volumeasked 2×From the following figures, compute the sales variances (total, price and volume) :(12)

4.

18 marks
· ~36 min

(a)Break-even point and profit at 75% capacity from two years' cost dataasked 2×Navya Limited began operations in 2022-23 with a total production capacity of 2,00,000 units. Data for two years are given below : The cost structure and selling price have not changed, and they are expected to remain…(9)

(b)Units needed to raise profit after a price cut and extra sales promotionasked 2×The following data relate to a manufacturing company : Plant Capacity = 4,00,000 units a year. Present Utilization = 45% Actual for the year 2023-24 were: Selling price = Rs.60 per unit, Material cost = Rs.24 per unit,…(9)

OR

(a)The P/V ratio: meaning, significance in decision making, and how to improve itasked 2×What is meant by the P/V ratio? Discuss its significance for decision-making. How it can be improved?(6)

(b)P/V ratio, break-even sales and sales for a target income from a cost equationasked 2×The following equation describes the Cost-Volume-Profit relationship of Tara Ltd.: Y = Rs.2,10,000 + 0.6X, where X stands for sales revenue, and Y for the total cost (FC + VC) at the level of sales revenue / Volume that…(12)

5.

18 marks
· ~36 min

Modernisation decision: equal-profit output, indifference point and comparative profitasked 2×Tara Ltd. gives the following details of its present operations: Selling price (Rs.) 24 Variable Cost per unit (Rs.) 18 Fixed Cost (Rs.) 60,000 Actual Output and Sales (units) 26,000 Management is considering a proposal…(18)

OR

(a)The key factor in management decision making, and measuring relative profitabilityasked 2×With examples, explain the concept of the key factor in management decision making? When a key factor is in play, discuss also the criteria used to measure relative profitability.(6)

(b)Optimum product mix with machine Z as the bottleneckasked 2×Meera Ltd., makes three products A, B and C, each of which uses three different machines X, Y and Z. The relevant data for June, 2024 are: Machine Z has been identified as the bottleneck, with capacity limited to 5,600…(12)

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