Permutations and Combinations

251 Practice MCQs available for CA Foundation

Paper

Paper 3: Quantitative Aptitude

Exam Weightage

4-6 Marks

Key Topics

Factorials, Permutations, Combinations

This chapter deals with the fundamental principles of counting. It covers factorials, circular permutations, restricted permutations, combinations, and the differences between selecting items versus arranging them.

Exam Strategy Tip

The most common mistake is confusing 'P' (Arrangement) with 'C' (Selection). If order matters (like opening a lock), use P. If order doesn't matter (like choosing a team), use C.

Key Terms

Permutation

An arrangement of objects in a specific order.

Combination

A selection of objects where order does not matter.

Comparison Tables

Permutations vs Combinations: The Quantitative Aptitude Guide

All 251 Questions

\displaystyle N

\displaystyle N! + \frac{1}{7!} = \frac{1}{8!}

A person can go from place 'A' to 'B' by 11 different modes of transport but is allowed to return to 'A' by any mode other than the one earlier. The number of different ways in which the entire journey can be completed is:

If a man travels from place A to B in 10 ways then by how many ways can he come back by another train?

\displaystyle \frac{n!}{10(n-1)!} = \frac{(n-1)!}{(n-3)!}

Which of the following is a correct statement.

\displaystyle ^nP_3 = 2 \cdot ^nP_2

\displaystyle n

\displaystyle ^nP_1 = 20 \cdot ^nP_0

\displaystyle P

denotes the number of permutations, then

\displaystyle n

\displaystyle ^nP_2 = 20 \cdot ^nP_0

, then the value of

\displaystyle n

\displaystyle ^nP_2 = 12

, then the value of

\displaystyle n

8 people are seated in a row in a meeting among them the president and vice president are to be seated always in the center. What is the arrangement?

How many numbers can be formed with the help of 2, 3, 4, 5, 6, 1 which are not divisible by 5, given that it is a five-digit no. and digits are not repeating?

How many four-digit odd numbers can be formed with digits 0, 1, 2, 3, 4, 7 and 8?

How many no. of seven-digit numbers which can be formed from the digits 3, 4, 5, 6, 7, 8, 9 no digits being repeated are not divisible by 5?

The number of words from the letters of the word BHARAT, in which B and H will never come together, is

The number of four-letter words can be formed using the letters of the word DICTIONARY is

The number of words that can be formed using the letters of the "PETROL" such that the words do not have "P" in the first position, is

The no. of different ways the letters of the word "DETAIL" can be arranged in such a way that the vowels can occupy only the odd position is

If four words are taken with or without meaning from the word 'LOGARITHAM' without repetition. How many words will be formed?

Three girls and five boys are to be seated in a row so that no two girls sit together. Total no. of ways of this arrangement are:

How many different groups of 3 people can be formed from a group of 5 people?

\displaystyle n

\displaystyle n

' corresponding keys are available, but the actual combination is not known. The maximum number of trials that are needed to assign the keys to the corresponding locks is:

The number of ways 4 boys and 4 girls can be seated in a row so that they are alternate is:

How many 3 digit odd no. can be formed using the digits 5, 6, 7, 8, 9 if the digits can be repeated?

\displaystyle ^nP_r = 12 \times ^nP_{r-1}

\displaystyle r

In how many different ways can the letters of the word 'SOFTWARE' be arranged so that the vowels always come together?

In how many different ways can the letters of the word 'CORPORATION' be arranged so that the vowels always come together?

\displaystyle ^nP_2 = 72

In how many ways can 5 boys and 3 girls sit in a row so that no two girls are together

In how many ways the letters of the word "STADIUM" be arranged in such a way that the vowels all occur together?

How many ways can 5 different trophies can be arranged on a shelf if one particular trophy must always be at the middle?

A user wants to create a password using 4 lowercase letters (a-z) and 4 uppercase letters (A-Z). No letter can be repeated in any form. In how many ways can the password be created if the password must start with an uppercase letter?

In a class of 4 boys and 3 girls, they are required to sit in a row in such a way that no two girls can sit together. Compute, in how many different ways they can sit together.

Find the value of n if

\displaystyle (n+1)! = 42 (n-1)!

In a lawn different ways can four persons stand in a line for a group photograph.

\displaystyle ^nP_r = 720

\displaystyle ^nC_r = 120

\displaystyle r

\displaystyle ^nP_r = 12 ^nP_{r-1}

\displaystyle ^nP_3 : ^nP_2 = 3 : 1

, then value of n is

\displaystyle ^nP_4 = 20 ^nP_2

then the value of 'n' is _______.

\displaystyle ^nP_3 : ^nP_2 = 2 : 1

How many Six-digit telephone numbers can be formed by using 10 distinct digits

The Sum of all the 4 digits numbers that can be formed with the digits 3,4,5,5 is

Find the number of even numbers greater than 100 that can be formed with the digits 0,1,2,3.

How many numbers can be formed with the help of 2, 3, 4, 5, 6, 1 which is not divisible by 5, given that it is a five-digit number and digits are not repeating?

If two letters are taken at random from the word HOME, what is the Probability that none of the letters would be vowels?

In how many ways the letters of the word 'ARRANGE' be arranged?

In how many ways can the letters of the word 'STRANGE' be arranged so that the vowels never come together?

The number of ways the letters of the word 'COMPUTER' can be rearranged is

How many ways can be letters of the word 'FAILURE' be arranged so that the consonants may occupy only odd places?

In how many ways can the letters of the word 'FAILURE' be arranged so that the consonants may occupy only odd positions?

The number of words that can be formed out of the letters of the word "ARTICLE" so that vowels occupy even places is

A box contains 3 pink caps, 2 purple caps and 4 orange caps. In how many ways the caps can be arranged so that the caps of the same colour are together. (Assume all caps of same colour are not identical)

How many different words can be formed with the letters of the word "LIBERTY"?

The number of ways of arranging 6 boys and 4 girls in a row so that all 4 girls are together is:

In how many ways can the letters of the word "ALGEBRA" be arranged without changing the relative order of the vowels?

In how many ways can the letters of the word "DIRECTOR" be arranged so that the three vowels are never together?

How many words can be formed with the letters of the word 'ORIENTAL' So that A and E always occupy odd places:

In how many ways can a party of 4 men and 4 women be seated at a circular table, so that no two women are adjacent?

\displaystyle ^nC_p + 2 \cdot ^nC_{p-1} + ^nC_{p-2} =?

There are 5 questions each have four options. In how many different ways can we answer the questions?

The number of triangle that can be formed by choosing the vertices from a set of 12 points, seven of which lie on the same straight line, is:

If there are 6 points in a line and 4 points in another line. Find the number of parallelogram formed?

There are 20 points in a plane area. How many triangles can be formed by these points if 5 points are collinear?

\displaystyle ^nP_r = 3024

\displaystyle ^nC_r = 126

\displaystyle n

\displaystyle r

A committee of 3 women and 4 men is to be formed out of 5 women and 7 men. Mrs. X can refuse to serve in a committee in which Mr. Y is a member. The no. of such committees can be:

In the next world cup of cricket, there will be 12 teams divided equally into two equal groups. Team of each group will play a match against other teams of the group. From each group, 3 top teams will qualify for next round. In this round, each team will play against each other. Four top teams of this round will qualify for semifinals and play against each other and then two top teams will go to final where they play the best of three matches. How much minimum number of matches in the next world cup will be?

\displaystyle ^{10}C_n = ^{10}C_{n-4}

\displaystyle n

A selection is to be made for one post of Principal and two posts of Vice-Principal. Amongst the six candidates called for the interview, only two are eligible for the post of Principal, while they all six are eligible for the post of Vice-Principal. The no. of possible combinations for the selection is:

How many total combinations can be formed of 8 different counters marked as 1, 2, 3, 4, 5, 6, 7, and 8, taking 4 counters at a time and there being at least one odd and one even numbered counter in each combination?

In a party every person shakes hands with every other person. If there are 105 handshakes in total, find the number of persons in the party.

In how many ways 3 prizes out of 5 can be distributed amongst 3 brothers equally

A Company wishes top simultaneously promotes three of its 8 department assistant mangers. In how many ways these promotions can take place?

\displaystyle ^nP = 336

\displaystyle ^nC = 56

\displaystyle n

\displaystyle r

\displaystyle ^nP_r = 720

\displaystyle ^nC_r = 120

\displaystyle r

In how many ways can a group of 3 ladies and four gents be chosen from 8 ladies and 7 gents?

A box contains 7 red, 6 white and 4 blue balls. How many selections of three balls on of each colour?

\displaystyle ^{15}C_3 + ^{15}C_{13}

\displaystyle ^5C_1 + ^5C_2 + ^5C_3 + ^5C_4 + ^5C_5

is equal to _______.

\displaystyle ^{15}C_{3r} = ^{15}C_{r+3}

\displaystyle r

The number in ways in which 4 persons can occupy 9 vacant seats is

An examination paper consists of 12 questions divided into two parts A and B. Part A contains 7 questions and Part B contains 5 questions. A candidate is required to attempt 8 questions selecting at least 3 from each part, in how many maximum ways can the candidate select the questions?

Find the number of combinations of the letters of the word COLLEGE taken four together:

The Supreme Court Bench consists of 5 judges. In how many ways, the bench can give a majority decision?

There 12 questions to be answered to be Yes or No. How Many ways this can be answered

\displaystyle ^nC_r + ^nC_{r-1} + ^nC_{r-2} + ...

There are 12 questions to be answered in Yes or No. How many ways can these be answered?

There are 12 points in a plane which are collinear with 4 points, number of triangular that can be formed with the vertices as there points are

The number of diagonals in a polygon of 6 sides

The number of triangles that can be formed by choosing the vertices from a set of 12 points, seven of which lie on the same straight line, is:

The number of triangles that can be formed by choosing the vertices from a set of 12 points, Seven of which lie on the same lie on the same straight line is:

Number ways of painting of a face of a cube by 6 colors is

A boy has 3 library tickets and 8 books of his interest in the library. Out of these 8, he does not want to borrow mathematics part II unless mathematics part-I is also borrowed. In how many ways can he choose the three books to be borrowed?

X and Y stand in a line with 6 other people. What is the probability that there are 3 persons between them?

The number of ways of painting the faces of a cube by 6 different colors is

If there are 30 points in a plane of which 5 points are lies on the same line. Then the number of triangles can be formed?

\displaystyle ^{20}C_x = ^{20}C_{x+6}

, Then the value of

\displaystyle x

A bag contains 4 red, 3 black and 2 white balls > In how many ways 3 balls can be drawn from this bag so that they include at least one black ball?

A Supreme Court Bench consists of 5 judges. In how many ways, the bench can give a majority decision?

The maximum number of points of intersection of

\displaystyle 10

circles will be:

\displaystyle ^{15}C_r = ^{15}C_{r+3}

, then 'r' is equal to

A Supreme Court Bench consists of

\displaystyle 5

judges. In how many ways, the bench can give a majority division?

In an election, there are five candidates contesting for three vacancies; an elector can vote any number of candidates not exceeding the number of vacancies. In how many ways can one cast his votes?

\displaystyle 7

\displaystyle 6

\displaystyle 4

blue balls. How many selections of three balls can be made so that none is red?

In how many ways

\displaystyle 3

\displaystyle 5

can be distributed amongst

\displaystyle 3

brothers equally

\displaystyle 12

questions to be answered to be Yes or No. How many ways this can be answered

\displaystyle ^{15}C_r = ^{15}C_{r+3}

\displaystyle r

\displaystyle ^{n}C_1 + ^{n}C_2 + ^{n}C_3 + ............

A user wants to create a password using

\displaystyle 4

lowercase letters (a-z) and

\displaystyle 3

uppercase letters (A-Z). No letter can be repeated in any form. In how many ways can the password be created if the password must start with an uppercase letter?

A candidate is required to answer

\displaystyle 6

\displaystyle 10

questions, which are divided into two groups each containing

\displaystyle 5

questions and he is not permitted to attempt more than

\displaystyle 4

from each group. In how many ways can he make up his choice?

The number of ways in which 8 examination papers be arranged so that the best and worst papers never come together

5 persons are sitting in a round table in such way that Tallest Person is always on the right side of the shortest person; the number of such arrangements is

An examination paper with 10 questions consists of 6 questions in Algebra and 4 questions in Geometry. At least one question from each section is to be attempted. In how many ways can this be done?

If 12 school teams are participating in a quiz contest, then the number of ways the first, second and third positions may be won is

A question paper contains 6 questions, each having an alternative. The number of ways an examiner can answer one or more questions is

The number of ways of 4 boys and 3 girls are to be seated for photograph in a row alternatively.

The number of 3-digit odd numbers can be formed using the digits 5,6,7,8,9. If repetition is allowed?

How many numbers of 3 digits can be made by using digits 3, 5, 6, 7 and 8 no. digit being repeated.

In how many ways of the word "MATHEMATICS" be arranged so that the vowels always occur together?

The number of words from the letters of the word BHARAT, in which B and H will never come together is

\displaystyle N

\displaystyle \frac{1}{7!} + \frac{1}{8!} = \frac{N}{9!}

There are 5 books on English, 4 books on Tamil and 3 books on Hindi. In how many ways can these books be placed on a shelf if the books on the same subjects are to be together?

Word 'REGULATION' is arranged without repetition. Find the probability that the vowels come at odd places.

The letters of the word VIOLENT are arranged so that the vowels occupy even place only. The number of permutations is:

A garden having 6 tall trees in a row. In how many ways 5 children stand, one in a gap between the trees in order to pose for a photograph?

Find the number of arrangements in which the letters of the word 'MONDAY' be arranged so that the words thus formed begin with 'M' and do not end with 'N'.

A room has 10 doors. In how many ways can a man enter the room by one door and come out by a different door.

In how many ways can 5 boys and 3 girls sit in a row so that no two girls are together?

How many ways can 5 different trophies can be arranged on a shelf if one particular trophy must always be in the middle?

\displaystyle \frac{1}{9!} + \frac{1}{10!} = \frac{x}{11!}

\displaystyle x

\displaystyle ^n P_r + r.^{n} P_{r-1}

A bag contains 4 red, 3 black and 2 white balls. In how many ways 3 balls can be drawn from this bag so that they include at least one black ball?

\displaystyle ^nP = 720

\displaystyle ^nC = 120

\displaystyle n

If these are 40 guests in a party. If each guest takes a shake hand with all the remaining guests. Then the total number of hands shake is _________.

In how many ways can 4 people be selected at random from 6 boys and 4 girls if there are to be exactly 2 girls?

A fruity basket contains 7 apples, 6 bananas, and 4 mangoes. How many selections of 3 fruits can be made so that all 3 are apples?

Out of 7 boys and 4 girls, a team of a debate club of 5 is to be chosen. The number of teams such that each team includes at least one girl is:

From a group of 8 men and 4 women, 4 persons are to be selected to form a committee so that at least 2 women are there on the committee. In how many ways can it be done?

A business houses wishes to simultaneously elevate two of its six branch heads. In how many ways can these elevations take place?

7 boys and 4 girls from which a team of 5 is to be selected, each team should have atleast one girl can be done in _________ ways

\displaystyle ^{1000}C_x = ^{999}C_3 + ^{999}C_y

\displaystyle x

\displaystyle ^{11}C_x = ^{11}C_{4x-1}

\displaystyle x \neq 4

, then value of

\displaystyle ^x C_x

\displaystyle ^{2n}C_2 : ^{n}C_2 = 11:1

\displaystyle n

In how many of distinct permutations of the letters in "MISSISSIPPI" when four I's do not come together?

Out of 7 consonants and 4 vowels, how many words of 3 consonants and 2 vowels can be formed?

Seema, Bharati, Priyanka, Khusboo and Lalita are 5 speakers. The number of ways in which Seema will always speak before Bharati shall be -

A team of 3 persons is to be constituted from a group of 2 men and 3 women. In how many ways can this be done if these teams would consist of 1 man and 2 women?

How many different words from the letters of the word MATHEMATICS can be formed so that all the vowels always come together in any word?

\displaystyle n

\displaystyle ^nP_5 = 20 \cdot ^nP_3

In a school, for a class monitor selection, there are 6 candidates, and students need to choose up to 3 monitors. A student can vote for 1 or 2 or 3 candidates. In how many ways a student can vote?

Different words are made with rearrangement of letters of the word "TROPICAL" in a way that the vowels occupy odd places when counted from left. How many such words are there?

\displaystyle ^nC_{r-1} = 28, ^nC_r = 56, ^nC_{r+1} = 70

, then the value of n and r are

In a meeting, 5 analysts, 2 consultants, and 3 managers are to be seated in a row. If members of the same profession must sit together, in how many ways can they be seated?

The total numbers greater than 2000 that can be formed with the digits 1, 2, 3, 4, 5 and no digits being repeated in any number are:

How many 3-digit number can be formed from the digits 2, 3, 5, 6, 7 and 9 which are divisible by 5 and none of the digit is repeated?

The no. of ways that

\displaystyle 12

prizes can be divided among

\displaystyle 5

students so that each may give

\displaystyle 3

\displaystyle 44

diagonals then the number of sides are

The number of ways of painting the six faces of a cube with six different given colours is

A polygon has 14 diagonals then the number of sides are

\displaystyle n, r

\displaystyle ^nP_r = 3024

\displaystyle ^nC_r = 126

A man has 5 friends. In how many ways can be invite one or more of his friends to dinner?

There are ten flights operating between city A and city B. The number of ways in which a person can travel from city A to city B and return by different flight is:

In how many ways can 4 people be selected at random from 6 boys and 4 girls if there are exactly two girls?

Five balls of different colours are to be placed in three boxes of different sizes. Each box can hold all the five balls. In how many different ways can we place the balls so that no box remains empty?

In an examination a candidate has to pass in 4 of the 4 papers. In how many different ways can be failed?

The number of ways 5 boys and 5 girls can be seated at a round table, so no two boys are adjacent is:

In how many different ways can the letters of the word 'DETAIL' be arranged so that the vowels occupy only the odd positions?

In how many ways can the crew of an eight seated boat be arranged so that 3 of crew can row only on a stroke side and 2 on the other side?

Eight chairs are numbered from 1 to 8. Two women and three men are to be seated by allowing one chair for each. First, the women choose the chairs from the chairs numbered 1 to 4 and then men select the chairs from the remaining. The number of possible arrangements is:

\displaystyle ^{15}C_{3r} = ^{15}C_{r+3}

\displaystyle r

\displaystyle ^{n}C_2 = ^{n}C_3

, the value of 'n' is

\displaystyle ^nP_6 = 336

\displaystyle ^nC_r = 56

, then n and r will be

Six boys and five girls are to be seated for a photograph in a row such that no two girls sit together and no two boys sit together. Find the number of ways in which this can be done.

In how many of distinct permutations of the letters in "MISSISSIPPI" when four I's do not come together?

Out of 7 consonants and 4 vowels, how many words of 3 consonants and 2 vowels can be formed?

Seema, Bharati, Priyanka, Khusboo and Lalita are 5 speakers. The number of ways in which Seema will always speak before Bharati shall be -

A team of 3 persons is to be constituted from a group of 2 men and 3 women. In how many ways can this be done if these teams would consist of 1 man and 2 women?

How many different words from the letters of the word MATHEMATICS can be formed so that all the vowels always come together in any word?

\displaystyle n

\displaystyle ^nP_5 = 20 \cdot ^nP_3

In a school, for a class monitor selection, there are 6 candidates, and students need to choose up to 3 monitors. A student can vote for 1 or 2 or 3 candidates. In how many ways a student can vote?

Different words are made with rearrangement of letters of the word "TROPICAL" in a way that the vowels occupy odd places when counted from left. How many such words are there?

\displaystyle ^nC_{r-1} = 28, ^nC_r = 56, ^nC_{r+1} = 70

, then the value of n and r are

In a meeting, 5 analysts, 2 consultants, and 3 managers are to be seated in a row. If members of the same profession must sit together, in how many ways can they be seated?

The total numbers greater than 2000 that can be formed with the digits 1, 2, 3, 4, 5 and no digits being repeated in any number are:

How many 3-digit number can be formed from the digits 2, 3, 5, 6, 7 and 9 which are divisible by 5 and none of the digit is repeated?

1. What is overhead absorption rate per hour as per traditional absorption costing method?

7. Calculate minimum stock level.

8. What will be danger level of stock ?

9. Calculate average number of days (round off) for which average inventory level to be held. COST AND MANAGEMENT ACCOUNTING

10. Calculate amount of Abnormal Loss during storage to be transferred to Costing Profit & Loss Account (based on average price)

11. PS Limited is facing downfall in its demand. Marketing team has suggested to reduce the selling price by 5% to compete in the market. Variable cost is 76% of the current selling price. You are required to find out the PN Ratio after reducing the price by 5%

12. In the automotive machine manufacturing sector, a component is manufactured. The Economic Order Quantity (EOQ) for the component is 1,500 units. The cost of placing an order is ` 100, and the carrying cost per annum is 10%. The cost per unit of component is ` 20. Calculate the annual demand for this specific automative component.

13. In a mutual project, both Raj and Bhuvan are contributing their efforts, using identical materials. Raj receives a bonus based on the Rowan plan, while the Halsey plan determines Bhuvan’s bonus. The standard time allocated for the project is 150 hours. Raj completes the project in 90 hours, while Bhuvan finishes it in 120 hours. The normal hourly wage rate for Raj is ` 30. The total earnings for both workers are equal. Calculate the normal hourly wage rate to be paid to Bhuvan.

14. On 01-04-2023 number of workers employed in a factory was 150. During the year 30 workers resigned and 5 workers were discharged. Due to resignation and discharge, 15 workers were replaced. For the year 2023-24, labour turnover rate by separation method will be :

2. What is full cost per unit of product Y under traditional absorption costing method?

3. Under an activity based costing system, what is the cost driver rate for machine set up costs?

4. Under an activity based costing system, the amount of allocated overheads attributable to machine running hours to product X is:

5. The total cost of product Z as per activity based costing method is :

6. The total number of units to be produced of product P is:

7. The total quantity of raw material R to be purchased during the year -

9. The budgeted variable cost of production of one unit of product P is -

10. What is the budgeted net income for the year?

11. AB limited has furnished the following data: Budget Actual (for the month of March) Production in units 40,000 48,000 Fixed overheads (`) 78,000 84,000 Calculate fixed overhead volume variance.

12. Two products Y and Z are obtained in a crude form and require further processing at a cost of ` 6 for Y and ` 5 for Z per litre before the products can be sold in the market. The final prices of product Y and Z are ` 15 and ` 8.75 per litre respectively. The company earns a net margin of 25% on Cost. The following data is available for output of both the products for the year Y 8,000 Litres Z 6,000 Litres A joint cost of ` 60,000 was incurred for the year and company apportions the joint costs on the basis of net realisable value after further processing. Calculate the joint cost per unit of product Y.

13. The data pertaining to the worker C in a factory depicts that he is paid at a rate of ` 100 per hour and a week comprises 48 hours for a 6 days’ work. The allowed absence time is 15 minutes per day for maintenance etc. The job card of C indicates, his chargeable time is scattered for 2 different jobs J1-21 hours and J2-24 hours. Any unaccounted time is attributable for power failure. Calculate cost of normal idle time and abnormal idle time.

14. During a certain period, 4,000 labour hours were utilized, and the standard hours for actual production were 5,500 hours. The Variable Overhead Efficiency Variance amounted to ` 15,000 (Favourable). Calculate the Standard Variable Overhead Rate per hour.

15. A company is analysing its inventory management practices and has determined that the Economic Order Quantity (EOQ) is 400 units. The cost incurred for placing a single order is` 25, while the total demand for the year amounts to 8,000 units. Calculate the Carrying Cost per unit.

Question No. 1 is compulsory. Attempt any four questions out of the remaining five questions. In case, any candidate answers extra question(s)/ sub-question(s) over and above the required number, then only the requisite number of questions first

Question 1 (a) XYZ Company has an option to buy any one of the two machines N or M to manufacture its unique industrial component P. Each of the machines have the capacity to produce same quality of component P and are almost identical except for the fact that they are being manufactured by a different manufacturers. The specifications for each Machine are: Machine M: It has the capacity to produce 50,000 components of P per annum, the fixed costs being 1,50,000 and could generate a profit of 2,25,000 on the sale of all the components produced. Machine N: It is also having the equal capacity to produce same number of components as that of Machine M per annum and all the components thus produced could be sold in the open market without any difficulty. Fixed cost of Machine N is 60,000 less than that of Machine M and yield a profit of 1,60,000 by selling all the components that are produced. The selling price of each component of P is 100. Required: (i) Calculate break even sales in value for each machine. (3 Marks) (ii) Calculate sales levels in units where both the machines are equally profitable. (2 Marks) (b) PQR Ltd. manufactures a product in batches of 2,000 units. The following costs are incurred for each batch Particulars Amount (in`) Direct Material Cost per Batch 2,40,000 Direct Labour Cost per Batch 1,65,000 Overhead Absorption Rate (variable) 120 per machine hour Expected Rejection Rate 3% Scrap Value per Rejected Unit 75 Other Information: Particulars Details Selling Price per Good Unit ` 250 Total Available Machine Hours per month 3,000 hours Fixed Overheads per Month ` 1,25,000 Batches Manufactured per Month 10 batches Required: (i) Calculate contribution per unit of good units after adjusting rejected units. (3 Marks) (ii) Calculate the company's total monthly profit. (2 Marks) (c) The Cost Accountant of a Manufacturing concern has given the following details in respect of a raw material X: Difference between Minimum lead time and Maximum lead time is 4 days. Average Lead time to procure the Raw Material X is 7 days. Reorder Level 1,80,000 units Reorder Quantity 90,000 units Minimum Stock Level 1,00,000 units Maximum Stock Level 1,90,000 units Required to Calculate: (1) Maximum Consumption per day (2 Marks) COST AND MANAGEMENT ACCOUNTING (2) Minimum Consumption per day (2 Marks)

Question 2 (a) The following information relates to a manufacturing concern A Ltd. for the year ended 31stMarch, 2024. Particulars As on 1st April,2023 As on 31st March,2024 Raw Material (in `) 3,40,000 1,80,000 Work in Progress (in `) 5,50,000 3,50,000 Particulars Amount Raw Material Purchased [Inclusive of GST@18% (Ineligible for ITC)] 8,00,000 Packaging Cost (primary) 3,00,000 Fee Paid to Independent Directors 5,00,000 Production bonus paid to factory workers 10% of Wages paid to factory workers Job charges paid to job workers 41,000 Salary paid to Supervisor 6,17,900 Wages paid to factory workers 6,30,000 Salary paid to Production Control Manager 7,20,000 Sale of Scrap generated during Manufacturing 50,000 Selling Overheads per unit 2 Salary paid to General Manager 12,40,000 Freight Inwards 2% on Raw Material Purchased Expenses Paid for Quality Control check activities 4,30,000 Particulars Cost Price (`) WDV as on 1st April, 2023 (`) Depreciation Rate Insurance Cost per annum Factory Building 25,00,000 21,87,000 10% 2% of Cost Price Plant and Machinery 15,00,000 11,56,000 15% 2% of Cost Price Office Building 40,00,000 36,00,000 10% Nil Additional information: (i) Depreciation is charged on the written down value method. (ii) Stock of finished goods as on 1st April, 2023 was 80,000 units having a total cost of 8,00,000. The entire stock of opening finished goods is sold during the year, closing stock is 70,000 units. During the period, 4,50,000 units were sold. (iii) A Ltd. wants a profit of 20% on Total Sales. Required: Prepare a Cost statement showing the various elements of cost and profit earned for the year ended 31stMarch, 2024. (9 Marks) COST AND MANAGEMENT ACCOUNTING (b) A skilled worker has assigned a work. The relevant data is given as follows: Time rate per hour ` 25 Time allowed 9 hours Time taken 6 hours The worker has given an option to choose either Halsey (50% plan) or Rowan plan. You are required to calculate earnings under both plans and which plan is more beneficial for a worker. (5 Marks)

Question 3 (a) A chemical compound manufactured through two processes namely Process X and Process Y. Process Y is dependent on the output generated by Process X and the semi-finished chemical compound received from Process X shall be mixed up with further materials in Process Y. The details of costs and other particulars for each process are given as follows: Process X Process Y Direct Material 1,000 kgs @ ` 50 per kg 700 kgs @ ` 90 per kg Direct Labour ` 35,000 ` 35,000 ` 25,000 Process Plant time 200 hrs @ ` 60/hr 120 hrs @ ` 80/hr Expected output 75% of input 80% of input Actual output kgs 700 1150 Realizable value of Normal Loss ` 8 per kg ` 5per kg Notes: (i) The departmental overhead for the period was 30,000 and is absorbed in each process on direct labour cost. (ii) Process plant time represents the attributable plant run time with respect to each process and is a part of direct process cost. (iii) Assume no finished stock and work in progress either at the beginning and end of the period. Required: Prepare Process X Account, Process Y Account, Normal Loss Account and Abnormal Gain Account. (2 + 2 + 2 + 2 = 8 Marks) (b) SW Limited manufactures Lenin bed covers. The present cost data are as below: Variable Cost of manufacturing per unit : ` 200 Variable cost of selling and distribution per unit : ` 100 Fixed costs : ` 16,00,000 Selling price per unit : ` 800 Expected Profit for the coming year : ` 8,00,000 The management could sense a stage of stagnation/deterioration in future sales with the new entrant RK Enterprises. The SW limited has approached to one marketing consulting firm for the study of cost volume profit analysis. The firm suggested three alternatives to fuel the sales growth by tinkering with the selling price. Alternatives Reduce selling price % Projected increase in sales (units) % (from the sales level that would generate ` 8,00,000 profit) 1 10.00 15 2 12.50 20 3 15.00 25 COST AND MANAGEMENT ACCOUNTING Required: Calculate the effect on profits under each alternative and recommend which alternative is most likely to be adopted to get the maximum profit. (6 Marks)

Question 4 (a) XYZ Transport is running a bus between town A and town B which are 25 kms apart. The bus will make 4 round trips every day carrying on an average 30 passengers on each trip. The bus costs the company a sum of ` 5,00,000. It has been insured at 2% per annum and the annual tax will amount to ` 2,000 and the garage rent is ` 500 per month. Annual repairs will be ` 8,000 and the bus is likely to last for 5 years. The driver's salary will be ` 15,000 per month and the conductor's salary will be ` 12,000 per month in addition to 10% of the takings as commission (to be shared by the driver and conductor equally). Cost of stationery will be ` 800 per month. Manager-cum-accountant's salary is ` 35,000 per month. Petrol and Oil will be ` 1,000 per 100 km. Assuming 15% profit on takings. Depreciation will be charged at straight line method. You are required to calculate the bus fare to be charged for per passenger kilometer. The bus will run on an average 25 days in a month. (b) LMN Foods is a manufacturer of organic snacks. For the year ending 2023, the company compiled the following financial data: (8 Marks) Item Amount (in `) Opening inventory of raw materials 2,00,000 Closing inventory of raw materials 2,50,000 Raw material purchases 12,00,000 Labour costs 5,00,000 Production overheads 2,50,000 Marketing and distribution expenses 1,52,000 In 2024, LMN Foods accepted a request for a bulk supply of their best-selling snacks. The estimated costs for fulfilling this order are as follows: • Estimated raw material cost: ` 3,00,000 • Estimated labour cost: ` 1,50,000 • Packaging and transportation costs: ` 49,400 LMN Foods allocates production overhead based on direct labour costs and marketing and distribution expenses as a percentage of the total production cost based on the previous year's data. Required: (i) Calculate the overhead recovery rates for 2023 based on actual costs. (2 Marks) (ii) Prepare a comprehensive cost statement for the bulk order and determine the Sales required for achieving a profit margin of 20% on the final sales amount. (4 Marks) COST AND MANAGEMENT ACCOUNTING

Question 5 (a) The following information has been provided by a company: Number of units produced and sold : 7,000 Standard labour rate per hour : ` 9 Actual hours worked : 17,820 hours Labour efficiency : 106.8% Labour rate variance : 71,280 (A) You are required to calculate : (i) Actual labour rate per hour (1 Marks) (ii) Standard hours required for 7,000 units (2 Marks) (iii) Labour Efficiency variance (1 Marks) (iv) Standard labour cost per unit (1 Marks) (v) Actual labour cost per unit (1 Marks) (b) Journalise the following transactions assuming that cost and financial accounts are integrated: (4 Marks) Particulars Amount (in `) Wages paid (20% indirect) 2,00,000 Selling and Distribution Overheads incurred 50,000 Deficiency found in stock of Raw Material (Normal) 80,000 Factory Overheads (Under Absorbed) 60,000 (c) Define spoiled work and defective work and discuss the treatment of defective work in the following circumstances: (1 + 3 Marks) Circumstances Treatment Where a percentage of defective work is allowed in a particular batch as it cannot be avoided. Where the defect is due to bad workmanship Where defect is due to the Inspection Department wrongly accepting incoming material of poor quality.

Question 6 (a) Explain the steps involved in procedure for reconciliation of Cost & Financial accounts. Also explain the circumstances where reconciliation statement can be avoided. (3+2 = 5 Marks) (b) State cost unit of the following Industry Sector: Industry Sector Cost Unit Oil Professional services Education Brick-making Education Brick-making Engineering Electricity Hotel/Catering Coal mining Brewing Hospitals (5 Marks) (c) Explain the methods that can be used for controlling Selling and Distribution Overheads. (4 Marks) OR (c) Suggest any one basis of re-apportionment of service department overheads over production departments in the following contexts: Cost of the Service Departments Basis Planning and progress Transport Department Personnel Department Fire Protection Power House (electric lighting cost) Computer Section Canteen and Welfare Hospital and Dispensary (4 Marks)

1. At what quantity of purchase of batteries, the ordering costs will be equal to the inventory carrying costs?

2. What will be the total annual cost of purchases as per the quantity calculated in Q-1 above?

3. Assuming that the company is willing to take a 15% risk of being out of stock, what would be the safety stock and the Re-order point?

4. Assuming that the company is willing to take a 5% risk of being out of stock what would be the safety stock and Re-order point?

5. Assuming 5% risk of out of stock what would be the total cost of ordering and carrying inventory for one year?

6. The minimum number of units of SS304 & SS316, the company shall produce to justify the sales forecast would be:

7. The ratio in which the raw material utilized for SS304 & SS316 from the total quantity of raw material procured, to produce the number of units desired in Q-6 above?

8. Assuming that all the available 1200 tons of raw material is procured per annum and would be utilized for production, what would be the raw material needed for production of SS 304 in order to maintain the same production mix arrived in Q-7 above?

9. Assuming that all the available 1200 tons of raw material is procured per annum and would be utilized for production, what would be the raw material needed for production of SS 316 in order to maintain the same production mix arrived in Q-7 above?

10. Keeping the management purchase policy & production quantity mix in consideration for SS304 & SS316, the maximum number of units of each product that company would produce (in units) respectively by utilizing 1200 tons of raw material:

11. Healthy & Fit Ltd. manufactures & sells a single product captioned as 'Exercise bikes'. The estimated units to be sold in the last quarter of the year 2024-25 are as under: Particulars January 2025 February 2025 March 2025 Exercise bikes (in units) 1,500 1,800 1,000 The company's policy is to hold closing stock of finished goods at 20% of the expected sales volume of the succeeding month. Each unit of exercise bike requires one unit of main body with resistance system & two units of pedals. Calculate the number of pedals required to be purchased for January 2025 production.

12. A company which operates a batch costing system is fully integrated with the financial accounts. During a particular period materials worth ` 30,000 and ` 20,000 were issued to production and Factory Maintenance respectively. The following control A/cs are being maintained. (i) Store ledger control A/c. (ii) Work-in-progress control A/c. (iii) Production overhead control A/c. (iv) Finished goods control A/c. From the above information, identify which account/accounts will be debited to effectuate the issuance of materials:

13. A Lorry starts with a load of 15 tons of goods from Station 'X'. It unloads 5 tons in Station 'Y' and balance goods in Station 'Z'. On return trip, it reaches Station 'X' with a load of 8 tons, loaded at Station 'Z'. The distance between X to Y, Y to Z and Z to X are 50 kms, 60 kms and 80 kms, respectively. Compute "Absolute Tons-Kilometre" and "Commercial Tons-Kilometre".

14. A company forecasts its labour costs and material cost to go up by 12% and 8% respectively per unit in the next financial year. If the ratio between material and labour is 5: 3, determine the increase in selling price as a percentage that the company shall keep to maintain its P/V of 12%, assuming variable overheads as nil.

15. A spice is passed through two processes and the output of Process I-Grinding, transferred to Process II-Packaging. The input units in Process 1 are 7,500 kgs and the output units are 7,275 kgs, abnormal gain is 150 kgs. You are required to calculate the normal loss percentage and value of abnormal gain, if the total expenses incurred in Process I are ` 1,50,750 and scrap has realisable value of ` 3 per unit.

5. Bonus under Rowan Scheme to be paid to 128 workers: Bonus = Time taken Time allowed × Time saved × hourly rate = 25,600 hours 31,250 hours × 5,650 hours × ` 30 = `1,38,854.4 Total wages to be paid to 128 workers are (` 7,68,000 + ` 1,38,854.4) ` 9,06,854.4, if company considers the introduction of Rowan Incentive Scheme to increase the Employee productivity. (i)

Question No. 1 is compulsory. Attempt any four questions out of the remaining five questions. In case, any candidate answers extra question(s)/ sub-question(s) over and above the required number, then only the requisite number of questions first

Question 1 (a) Axion Industries is a heavy industrial gear manufacturing company with a manufacturing setup based in Pune. Mr. Andrew, the CFO of the company furnished the following information to Mr. Joe who heads the Finance department. For FY 2024-25: Particulars Amount ` (in crores) Total Sales 1,00,000 Raw material cost 50,000 Direct wages 15,000 Fixed & variable overheads 25,000 Profit 10,000 Total Number of Units sold 40,000 units The market being very competitive and with the raw materials rates rising, Mr. Andrew raises his concern with Mr. Joe where he expects in the next financial year 2025-26 workers’ wages to rise by 20%, fixed costs component to decrease by ` 500 crores. Total fixed & variable overhead however is to be ` 28,500 crores. Total fixed & variable overhead however is to be ` 28,500 crores. The total number of units expected to be sold would be 50,000. Required: Calculate the minimum number of units to be sold to sustain the same per unit profit in the financial year 2025-26 also. (Ignore further effects on Fixed costs.) (5 Marks) (b) Aroma Park Ltd. Produces two perfumes named Floral, Oriental, and one Cologne, all created through a joint production process. Below are the data from the most recent month of production: Products Floral Oriental Cologne Sales Price ` 80 `200 ` 300 Quantity (in units) 5,000 3,000 2,000 Joint Cost ` 60 ` 60 ` 60 Cost after split off ` 40 ` 80 ` 100 Total cost ` 100 ` 140 ` 160 The management on reviewing the above cost data is of the opinion that either they are selling the largest – volume product at a loss or the product cost data is flawed. Required: (i) Prepare statement showing profit / loss for each product based on the given data. (2 Marks) (ii) Respond to the management perception by showing joint cost apportionment under Net Realisable Value method. (3 Marks) (c) Following information is given of a newly setup organization for the year ended on 31st March, 2025: Number of workers replaced during the period 78 Number of workers left and discharged during the period 28 Employee turnover rates using separation method 3.5% Required: Compute the employee turnover rates using: (i) Replacement method and (2 Marks) (ii) Flux method (2 Marks) COST AND MANAGEMENT ACCOUNTING

Question 2 (a) Kidz Company manufactures and sells two models of baby toys namely, Max and Pro. During the Financial Year 2024-25, 1,500 units of Max and 3,600 units of Pro were manufactured. However, only 60% of Max and 80% of Pro were sold during the year. Labour cost per unit of Max is two times that of Pro. There was no opening stock of finished goods or work-in progress. The cost particulars of the two models of Baby Toys are given below: Particulars Max (`) Pro (`) Total (`) Material Cost 42,000 63,000 1,05,000 Labour Cost - - 1,21,000 Further, the cost controller of the factory informed that: • Works overhead is 50% of labour cost • Office overhead is recovered at 20% of works cost. • Selling and distribution overhead is ` 20 and ` 30 per unit sold for Model Pro and Model Max respectively. Required: (i) Prepare a cost sheet for the financial year 2024-25, showing the various elements of cost for each model of Baby Toys (Prime cost, work cost, cost of production, cost of goods sold and cost of sales). (ii) Calculate the per unit selling price of each model of Baby Toys if profit is charged at 20 percent on sales. (7 Marks) (b) A plastic manufacturing company is operating with an employment of 128 skilled workers. The product is in great demand. The company desires to increase production to meet market demand but is short of skilled workers. The company finds extremely difficult to find new skilled workers to fulfil its demands. The company is considering the introduction of an incentive scheme – either Halsey scheme (with 50% bonus) or Rawan scheme of wage payment for increasing the labour productivity to cope up the increasing demand. The company believes that if the proposed incentive scheme could bring about an average 15% increase over the present earnings of the workers, it could act as sufficient incentive for them to produce more with increased efficiency. The following data is worth consideration, in measuring the increase in productivity for the month of April 2025. Hourly rate of wages (guaranteed) ` 30 Maximum time allowed to produce one unit by one worker 2.5 hours Number of working days in the month 25 Number of workers hours per day of each worker 8 Actual production during the month (units) 12,500 Required: (i) Calculate the effective rate of earnings under the Halsey scheme and the Rowan scheme. (ii) Calculate the increased labour efficiency on introduction of the incentive schemes. (iii) Calculate the savings to the plastic company in terms of direct labour cost per unit under both the schemes. (iv) Advise the company about the selection of the scheme to fulfil their assurance. (7 Marks)

Question 3 (a) Meri Chai Teri Chai Ltd., is engaged in manufacturing three products: - Ginger Chai - Masala Chai - Saffron Chai It calculates activity cost rates based on cost driver capacity. Activity Cost driver Capacity Cost (`) Machine Setup Number of setups 64 7,68,000 COST AND MANAGEMENT ACCOUNTING Machine Processing Machine hours 1,40,000 7,00,000 Quality inspection Number of inspections 544 6,80,000 Packaging Number of packings 600 7,20,000 For the year ended 31st March 2025, the following consumption of cost drivers was reported: Product Number of setups Machine hours Number of inspections Number of packings Ginger Chai 21 45,000 190 190 Masala Chai 22 50,000 204 250 Saffron Chai 17 40,000 150 150 Required: (i) Compute the costs allocated to each product from each activity on the basis of Activity- Based Costing method. (ii) Calculate the cost of unused capacity for each activity. (8 Marks) (b) Max Cinemas has three types of seats – Classic, Prime & Recliner where the total capacity is 306 seats, which are divided in the ratio of 12: 4: 1 respectively. The ticket price of Prime is twice of Classic ticket price and that of Recliner is thrice of Prime ticket price. Following information is given: Types of seats Occupancy percentage Classic 75% Prime 50% Recliner 50% On a daily basis, 4 movie shows are run throughout the year. The total cost per day is estimated to be ` 77,760. Assume 25% profit on total revenue. Required: (i) Calculate Equivalent Classic seats per day. (ii) Calculate Ticket prices of all three types of seats. (6 Marks)

Question 4 (a) NT Ltd. showed a net loss of ` 9,000 as per their cost accounts for the year ended 31-03-2025. However, the financial books disclosed a net profit of ` 7,000 for the same period. The following information was revealed as a result of scrutiny of the figures of both the sets of books: (`) Factory overheads absorbed 52,000 Selling & distribution overheads over absorbed 6,000 Administrative overheads under absorbed 7,500 Interest on Loan 8,800 Dividend received 9,000 Factory overheads charged 45,000 Depreciation charged in financial accounts 42,000 Depreciation recovered in cost accounts 45,000 There is the difference in the value of closing stock of finished goods due to varying basis of valuation. 500 units of closing stock is valued at ` 41,000 in cost accounts whereas market price per unit of closing stock is ` 80 per unit. It is found that there is still a difference in the reconciliation statement after considering all of the above which is due to the excess of raw material consumption in cost accounts. Prepare: (i) A reconciliation statement taking net loss as per cost accounts as base, and (ii) Find out the excess of material consumption during the period in cost accounts effectuated the difference in reconciliation. (8 Marks) (b) A manufacturing unit using Standard costing system and the following information was obtained from its records: Standard Actual Production 4,800 units 4,560 units Working days 25 27 COST AND MANAGEMENT ACCOUNTING Fixed overhead ` 48,000 ` 46,800 Variable overhead ` 14,400 ` 14,400 Required: Calculate the following overhead variances: (i) Variable overhead variance (ii) Fixed overhead variance (iii) Fixed overhead Expenditure variance (iv) Fixed overhead Volume variance (v) Fixed overhead Calendar variance (6 Marks)

Question 5 (a) Furniture Wala Ltd., a manufacturer of dining tables, procures wood as its direct material. The dining tables are initially processed in the Moulding department and subsequently transferred to the Laminating department, where a plastic layer is applied. The Moulding department began manufacturing 35,000 initial dining tables during the month of March 2025 for the first time and their cost is as follows: Direct material: ` 1,15,500 Moulding costs: ` 59,500 Total ` 1,75,000 A total of 28,000 dining tables were completed and transferred to the Laminating department, the rest 7,000 were still in the Moulding process at the end of the month. All of the Moulding department's direct materials were placed but on average, only 25% of the conversion costs were applied to the ending work in progress inventory. Required to calculate: (i) Equivalent units of production for each cost. (ii) The Moulding cost per Equivalent units. (iii) Cost of closing work-in-process (WIP) and finished products. (4 Marks) (b) Distinguish between "job costing and batch costing". (3 Marks) (c) A reputed engineering college in Pune has 20 sections with 60 students per section. The college plans a one day pleasure trip around the city for the students during the weekend to places such as zoo, the amusement park and the technological museum. A private transport operator has agreed to provide the required number of buses at a hire charge of ` 6,500 per bus per trip. The bus hire charge is inclusive of special permit fees of ` 500 per bus per trip paid to the city municipal corporation. Each bus has a maximum seating capacity of 54 persons excluding the driver. Four seats are reserved for the teachers who accompany each bus. The college will employ four teachers for each bus and pay ` 500 as daily allowance to each teacher for the trip. No other costs in respect of teachers are relevant to the trip. The following are the other cost estimates: Particulars Cost per student (`) Breakfast 55 Lunch 120 Evening tea with snacks 40 Entrance Fee at amusement park Fee entry Entrance Fee at the zoo 25 As regards the technological museum, the authorities charge block entrance fees for group of students depending upon the number of students in the group as enumerated below: Number of students in the group Block Entrance Fees (`) Upto 300 2,000 COST AND MANAGEMENT ACCOUNTING 301-900 3,000 901 and above 3,500 Cost of prizes that would be distributed to the winners in different games being arranged in the amusement park depends upon the number of students in a trip. The cost of prizes to be distributed is: Number of students in a trip Cost of prizes (`) Upto - 300 2,200 301- 600 2,400 601 - 900 2,400 901 and above 2,500 Assuming that the college hires the requisite number of buses depending upon the number of students in a trip, you are required to: (i) Prepare a flexible budget, estimating the total cost for a trip for the levels of 300, 600, 900 and 1,200 students showing each item of cost separately. (ii) Compute the average cost per student at each of the above levels. (7 Marks)

Question 6 (a) In the following independent situations, identify the type of cost and state whether it is relevant/non-relevant in managerial decision making: (i) A Limited owns a commercial space of 1500 square feet and uses the same for its own office accommodation purposes. Similar office is available nearby on rent of ` 30,000 per month. (ii) MNC Limited has paid ` 1 Lakh as rent for a factory shed which is temporarily closed for the last two months. (iii) Beta Company has paid ` 3 Lakhs to a market research agency to find out the market demand of the innovative product developed by the company. COST AND MANAGEMENT ACCOUNTING (iv) Zen LLP has paid incentive of ` 5 Lakhs @ 1% on sales to the salesmen for achieving sales beyond the expected sales of ` 25 Lakhs per month per salesman. (v) A start-up company has invested ` 50 Lakhs in Project P. The company could have earned interest of ` 3 Lakhs by investing the amount in a bank fixed deposit @ 6% per annum. (5 Marks) (b) Cosmos Limited uses activity based costing and accumulates overhead costs in the following cost pools: (1) Human Resources (2) Maintenance of buildings (3) Parts Management (4) Plant security (5) Purchasing (6) Floor manager's salary (7) Quality control (8) Machine set-up (9) Designing the product (10) Receiving Department Classify each cost pool as per cost hierarchy i.e. unit level, batch level, product level or facility level. (5 Marks) (c) Describe briefly the methods for valuation of work-in-process followed in Process Costing. (4 Marks) OR (c) Contemplate the list of functions given below and identify each one of them with the most relevant scope of Cost Accounting: (i) It involves a detailed examination of each cost. (ii) Helps in planning and control, performance appraisal and managerial decision making. (iii) Cost involved in alternative courses of action. (iv) To find out factors responsible for variance in actual costs from the budgeted costs. (4 Marks)

1. Equivalent units of Material and Material cost per unit

2. Equivalent units of labour and overheads and total cost per unit

3. Value of abnormal loss to be shown in process account

4. Value of units transferred to next process

5. Value of closing WIP

6. Calculate per unit cost of material by using Average Price Method.

15. A Chemical is passed through three processes and the output of Process 1 Account is transferred to Process 2 Account. The input units in Process 1 are 58,500 units and the output units are 55,200 units, normal loss is 2% and rest is abnormal loss. You are required to calculate the per unit cost of output units in Process 1 Account, if the total expenses incurred in Process 1 are, 6,87,960.

9. Bad debts recovered in financial accounts 50,000 Required: Prepare Reconciliation Statement to arrive at net profit/loss as per Cost Accounts. (5 Marks)

1. Calculation of Oil Expenses. Particulars Machines X (`) Y (`) Z (`) Oil Expenses 1,50,000 1,50,000 1,12,500 Add: Increase in Price @20% 30,000 30,000 22,500 1,80,000 1,80,000 1,35,000 Add: Increase in Consumption @10% 18,000 18,000 - Total 1,98,000 1,98,000 1,35,000

Question No. 1 is compulsory. Attempt any four questions out of the remaining five questions. In case, any candidate answers extra question(s)/ sub-question(s) over and above the required number, then only the requisite number of questions first

Question 1 (a) Language Achievers, a renowned institute specializing in TOEFL preparation, has secured a spacious hall for 20,000 on weekly basis with a seating capacity of 250 students. The instructor, highly qualified and experienced, is compensated generously with an honorarium of 1,500 per lecture. Additionally, he receives reimbursement for travel expenses of ` 200 per day along with refreshments costing 1,500 per week to ensure his comfort and focus during teaching sessions. Administrative and miscellaneous expenses, covering essential utilities and materials are, 500 per week. Language Achievers has meticulously planned its curriculum, scheduling batches of 2 lectures per day, 5 days a week for 30 weeks, ensuring comprehensive coverage of the TOEFL syllabus. Required: (i) Calculate the total cost per batch. (ii) Determine the minimum fee per student in a batch to cover costs, if the batch is fully occupied. (iii) Calculate the fee to be charged from. each student if batch is 80% filled and institute aims to achieve a profit margin of 25% on the fee. (5 Marks) COST AND MANAGEMENT ACCOUNTING (b) XYZ Ltd. declared a net profit of ` 2,25,000 based on their financial accounts for the year ending 31st March, 2024. The profit disclosed in cost books are not matched with financial accounts. The following information were revealed during the scrutiny of the figures of both the sets of books: Sr. No. Particulars ` 1. Preliminary expenses written off in financial accounts 35,000 2. Factory Overheads Over charged in cost accounts 20,000 3. Expenses on issue of shares in financial accounts 30,000 4. Undervaluation of closing stock in cost accounts 65,000 5. Interest on Bank Deposits in financial accounts 60,000 6. Under recovery of administration overheads in cost accounts 25,000 7. Notional Rent of own premises charged in cost accounts 30,000 8. Under recovery of selling overheads in cost accounts 35,000 9. Bad debts recovered in financial accounts 50,000 Required: Prepare Reconciliation Statement to arrive at net profit/loss as per Cost Accounts. (5 Marks) (c) JC Ltd. has a production capacity of 80,000 units per year. Presently a company produces 60,000 units. Its cost structure is as under: Material Cost ` 6 per unit Labour Cost ` 4 per unit Variable overheads ` 2 per unit Total fixed cost ` 3,00,000 per annum. Present selling price ` 20 per unit in the month of January, 2024 company received an offer from a Japanese client to supply 20,000 units at a price of ` 14 per unit with the additional shipping cost of ` 8,000. Required: (i) On the basis of changes in the profit, advice to the company, whether the offer should be accepted or not? (ii) Will your advice be different, if the customer is local one? (iii) If Japanese client offer for supply of 30,000 units to a price of ` 14 (part supply of order not accepted) and shipping cost treated as variable cost, analyze the impact on the profit of JC Ltd., if order accepted. (4 Marks)

Question 2 (a) MNP Limited have the capacity to produce 84,000 units of a product very month. Its prime cost per unit at various levels of production is as follows: Level Prime Cost per unit (`) 10% 50 20% 48 30% 46 40% 44 50% 42 60% 40 70% 38 80% 36 90% 34 100% 32 Its prime cost consists of raw material consumed, direct wages and direct expenses in the ratio of 3 : 2 : 1. In the month of January 2024, the company worked at 40% capacity and raw material purchased amounting to ` 8,40,000. In the month of February 2024, the company worked at 100% capacity and raw material purchased for ` 16,46,400. It is the policy of the company to maintain opening stock of raw material equal to 1/3 of closing stock of raw material. Factory overheads are recovered at 60% of direct wages cost. Fixed administration expenses (as part of production cost) and fixed selling and distribution expenses are ` 2,01,600 and ` 1,68,000 per month respectively. During the month of January 2024 company sold 33,600 units @ ` 68.8 per unit. The variable distribution cost amounts to ` 1.5 per unit sold. The management of the company chalks out a pl for the month of February 2024 to sell its whole output @ ` 61 per unit by incurring following further expenditure : (i) Company sponsors a television programme on every Sunday at a cost of ` 26,250 per week. There are 4 Sundays in February 2024. (ii) Hi-tea programme every month for its potential customers at a cost of ` 1,05,000. (iii) Special gift item costing ` 105 on sale of a dozen units. (iv) Lucky draws scheme is introduced every month by giving the first prize of ` 1,00,000; second prize of ` 80,000; third prize of ` 40,000 and four consolation prizes of ` 8,000 each. Note: (In the month of February 2024, there is a significant saving in material cost per unit due to entry of new suppliers in the market and saving in per unit cost of Direct wages and Direct expenses due to introduction of new· policy by the management.) Prepare a cost sheet for the month of January 2024 and February 2024 showing prime cost (with different elements of prime cost), factory cost, cost of production, total cost and profit earned. (8 Marks) (b) In a factory there are 50 workers, working 8 hours per day including 30 minutes for lunch break, worked for 160 days during a period of six months ended on 31st December, 2023. During this period total employee's cost was recorded ` 3,90,000. The management of the factory decided the overtime premium rates for the month of January 2024 as under : Sundays and holidays 180% of basic wages rate Before and after normal working hours 160% of basic wages rate COST AND MANAGEMENT ACCOUNTING During the last six months (ended on 31st December, 2023), the following hours were worked: Normal time 56,250 Sundays and holidays 750 Before and after normal working hours 3,000 Total hours· 60,000 During the month of January 2024, the factory worked on a job BX in the following manner. Normal working 2,400 men hours Overtime on Sundays and holidays 200 men hours Overtime before and after normal working 400 men hours Total hours 3,000 You are required to calculate the labour cost chargeable to job BX and overheads in each of the following situations: (i) Where overtime is worked regularly in whole year as a policy on account of shortage of workers. (ii) Where overtime is worked irregularly to meet the requirement of production. (iii) Where overtime is worked at the request of the customer to complete the job in time. (iv) Where overtime is worked on account of flood in the area. (6 Marks)

Question 3 (a) GST Limited is a multi-product company. The production and cost details of its two products P and Q are given as follows: Particulars Product P Q Quantity produced (No.) 9,000 7,200 Direct material cost (`) 72,000 50,000 Direct labour hours 800 600 Purchase requisition (No.) 180 144 Production runs (No.) 144 108 Quality inspections (No.) 27 18 Direct wages rate is ` 14.50 per hour. Presently the company uses a single overhead recovery rate based on direct labour hours. Overhead incurred by the company during the year 2023-24 are as follows: Technical staff salary ` 45,000 Machine operation expenses ` 1,62,000 Machine maintenance expenses ` 27,000 Wages and salary of stores staff ` 36,000 During this period direct labour hours worked 72,000. Now the Company wants to adopt Activity Based Costing. For this purpose, following activities are identified: - Quality control - Setup of machine for production runs - Store receiving It is also decided that salary of technical staff should be distributed among machine maintenance, setup and quality control in the ratio of 1 : 2 : 2. Machine maintenance expenses and machine operation expenses should be distributed in the ratio of 2 : 3 in between stores and production setup activities. COST AND MANAGEMENT ACCOUNTING During this period cost drivers for these activities are identified as under: - Requisition raised 5,760 - Production setup 7,200 - No. of quality test 720 You are required to compute: (i) The cost of products P and Q based on traditional absorption costing system. (ii) The cost of products P and Q based on ABC Costing system. (8 Marks) (b) Savi Limited is currently working at 80% of its capacity level and furnished the following information for current period: Production / Sales 96,000 units Direct Variable Cost ` 20 per unit Factory Overheads ` 8,40,000 Administrative Overheads (Fixed) ` 20,60,000 Sales Commission 2% of Sales Value Transportation Expenses ` 4,000 per truck (Loading Capacity 4,000 units) The selling price of the product is ` 120 per unit and Factory Overheads are 80% variable in nature. The management of Savi Limited has come.to know that there will be high fluctuations in the demand of the product in upcoming year and it would not be an easy task to predict the demand. Selling price per unit will not be affected by demand fluctuations. Savi Limited has decided to prepare a flexible budget for. the product at 60%, 80% and 100% capacity level. You are required to prepare the Flexible Budget showing total cost of the product at each level. (6 Marks)

Question 4 (a) BG company produces a standard product and sold in a packet of 10 kg. The standard cost card per pack is as follows: Direct Material: A - 4 kg @ ` 50 per kg COST AND MANAGEMENT ACCOUNTING B - 8 kg @ ` 40 per kg Direct Labour: 6 hours @ ` 20 per hour The company manufactured and sold 1,600 packets during the month. Actual data for material and labour recorded as under. Direct Material: A - 7,000 kg @ ` 40 B - 12,500 kg @ ` 45 Labour hours paid for two different categories of workers: Skilled 6,000 hours @ ` 25 Semi-skilled 4,000 hours @ ` 20 5% of the time paid was lost due to an abnormal reason. Calculate the following variances indicating their nature (Favourable or Adverse): (i) Material cost variances (ii) Material price variances (iii) Material usage variances (iv) Material mix variances (v) Material yield variances (vi) Labour cost variances (vii) Labour rate variances (viii)Labour efficiency variances (ix) Labour Idle time variances (9 Marks) (b) Explain Build-Operate-Transfer (BOT) approach and classify the following expenses in Capital Cost or Operating and Maintenance Cost for Toll Roads: (i) Land acquisition (ii) Interest expenses incurred for servicing term loans (iii) Material and Labour (iv) Toll Collection Expenses (v) Contingency Allowance (vi) Periodic painting cost of railings etc. (2 + 3 = 5 Marks)

Question 5 (a) This data pertains to the three machines operating in the manufacturing division of PQR Corp for the financial year 2023-2024: Particulars Estimated Expenses TOTAL (`) Machines X (`) Y (`) Z (`) Direct Labour Expenses (per quarter) 2,50,000 Oil Expenses (per quarter) 1,03,125 37,500 37,500 28,125 Machine Insurance Expenses (per quarter) 60,000 Depreciation (per annum) 6,00,000 1,00,000 2,00,000 3,00,000 Building Maintenance Expenses (per quarter) 1,00,000 Wages of Operator (per quarter) 2,25,000 Electricity Expenses (per quarter) 3,00,000 Rent and Rates (per month) 80,000 Salary of Technician (per month) 62,500 (The Technician works only on machines X and Y and the Operator controls all three machines and both spend equal time on each of the machines worked upon by them.) COST AND MANAGEMENT ACCOUNTING There are 14 holidays besides Sundays in the year, of which six are on Saturdays. There was a Strike of workers for 5 working days (including one Saturday). The manufacturing department operates for 8 hours per day on regular week days, while on Saturdays, the operating hours are reduced by 2 hours per day. All machines operate at 80% capacity throughout the year. Assume 366 days in a year. The following additional information is also available: (i) A 20% hike in the price of oil. (ii) A 10% rise in Oil consumption for machines 'X' and 'Y' only. (iii) Particulars Machines X Y Z No. of Workers 5 3 2 Ratio of K.W. Rating 3 3 4 Ratio of Floor space utilized 1 2 1 Required: Prepare a Statement detailing the allocation of expenses to each machine on an annual basis and thereafter, compute the comprehensive machine hour rate for each of the specified machine. (7 Marks) (b) ABC Ltd. is a well-known company for producing baby care products. The company produces and sells two variants of organic shampoo for children: "Baby Rose" and "Baby Lily". The sales and cost data for both products are provided below: Particulars Baby Rose Baby Lily Current demand and Sales (Number of bottles) 4,000 3,000 Production Capacity (Number of bottles) 7,500 6,000 Selling Price per bottle (`) 600 750 Variable Costs per bottle: - Direct Materials (` 20 Per litre) 160 200 - Other Variable Costs 270 350 The fixed costs amount to ` 5,00,000 and ` 4,50,000 for Baby Rose and Baby Lily respectively. The Production Manager has informed that 1,00,000 litres of material is available for production. A dealer has approached the company and proposed to purchase both products at the existing selling prices, which are to be produced by utilizing the remaining unused material. However, he has insisted that all the bottles must be packed with eco-friendly packaging, which will result in an additional cost of ` 10 per bottle for the company. Presently, the company is not using eco-friendly material for packing of bottles. Required: Prepare a detailed statement showing the overall contribution and profit of the company after acceptance of the dealer's proposal. (7 Marks)

Question 6 (a) Describe any five benefits of the Digital Costing System. (5 Marks) (b) Define the following terms: (i) Controllable Variance (ii) Uncontrollable Variance (iii) Budget Manual (iii) Performance Budgeting (iv) Budget Period (5 Marks) (c) Discuss the treatment of By-products in cost accounting. (4 Marks) OR (c) Define Job costing and explain differences between job and batch Costing. (4 Marks) COST AND MANAGEMENT ACCOUNTING

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