Question 1) Answer all the questions:
(i) Define the term economic order quantity?
(ii) What do you understand by allocation and apportionment of overhead?
(iii) In which industries is operating coating used.
(iv) What are the various methods of computing profit on an incomplete contract?
(v) What is idle time variance? How is it computed?
Question 2) What is the meaning of Cost Accounting? Describe briefly the object and advantages of cost accounting.
Question 3) What do you mean by Process Costing? Describe Normal Wastage, Abnormal Wastage and Abnormal Gain and state how they must be dealt with in process cost accounting.
Question 4) During the month of June, 2012 the following receipt and issue of materials were made. Record transaction in the Store Ledger Account on the basis of First in First out (FIFO) method and Last in First out method. Charging wastage as factory overhead and shortage at inflated price.
01.06.2012 Opening balance 200 kgs, @ Rs. 20 per kg.
03.06.2012 Receipt 250 kgs. @ Rs. 12 per kg.
05.06.2012 Issue 250 kgs.
07.06.2012 Receipt 200 kgs. @Rs. 16 per kg.
15.06.2012 Wastage (as per stock verification report) 5 kgs.
20.06.2012 Receipt 250 kgs. @Rs. 20 per kg.
25.06.2012 Issue 425 kgs.
26.06.2012 Shortage 20 kgs.
30.06.2012 Receipt 50 kgs. @ Rs. 24 per kg.