## Final Term Paper Current MGT402 Cost & Management Accounting 11 August 2010

Objectives were mostly from Process costing (FIFO, Avco), Marginal costing and Type of costs. (Every student is getting different objective questions focusing on some specific topics: Students must prepare solved 2010 Current papers Mcqs uploaded)

Subjective type Students must prepare solved 2010 Current papers Subjective uploaded )

Question No: 49: ( Marks: 3 )

Can differential cost costs be Incremental and Avoidable costs? Explain with examples.

Question No: 50 ( Marks: 3 )

The following information is available for Atlas Corporation to prepare a cash budget for the month of September:

· Cash on hand beginning of September Rs. 16,000

· Expected receipts in September Rs. 272,000

· Sales salaries paid Rs. 62,000

· Material purchases (all in cash) Rs. 190,000

· Depreciation Rs. 44,000

Required: Calculate ending cash balance in September. Also show complete working.

Question No 51: ( Marks: 5 )

A Manufacturing Company estimates its production. Material will require 900 units for January, 700 units for February and 2100 units for March. It takes 3 direct labor hours at a rate of Rs. 3.1 per hour to complete one unit.

Required: Prepare Labor cost budget cost.

Question No: 52 ( Marks: 5 )

Basit Ali Company produces and sells Makka Cola to retailers. The Cola is

bottled in 2-litter plastic bottles. The estimated budgeted sales for the year 2008 would be Rs. 80,000 and the estimated Profit for the year 2008 would be Rs. 4,060. The Margin of safety Ratio is calculated as 25%.

Required:

1- Breakeven Sales for the year 2008

2- Projected Income statement for the year 2008

Question No: 53 ( Marks: 5 )

Golden Company sells its product for Rs. 42 per unit. The company’s unit product cost based on the full capacity of 400,000 units is as follows:

mgt402 11-8-2010.JPG

A special order offering to buy 40,000 units has been received from a foreign distributor. The only selling costs that would be incurred on this order would be Rs. 6 per unit for shipping. The company has sufficient idle capacity to manufacture the additional units. Two-thirds of the manufacturing overhead is fixed and would not be affected by this order. Assume that direct labor is an avoidable cost in this decision. In negotiating a price for the special order, calculate the minimum acceptable selling price per unit?