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Costing D1 Questions

The document outlines a series of questions related to budgeting, cost allocation, and financial analysis for various scenarios including a school picnic, a manufacturing concern, and a hotel occupancy. It requires the preparation of flexible budgets, cost allocation statements, cost sheets, and tariff calculations. The tasks involve estimating costs, comparing average costs per student, and determining break-even points for different activities and businesses.

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33 views4 pages

Costing D1 Questions

The document outlines a series of questions related to budgeting, cost allocation, and financial analysis for various scenarios including a school picnic, a manufacturing concern, and a hotel occupancy. It requires the preparation of flexible budgets, cost allocation statements, cost sheets, and tariff calculations. The tasks involve estimating costs, comparing average costs per student, and determining break-even points for different activities and businesses.

Uploaded by

hit41898
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Question 1:

Aman International School has a total of 180 students consisting of 6 sections with 30 students per
section. The school plans for a picnic around the city during the week-end to places such as Prayag
zoo, the Capi Park, Azad planetarium etc. A private transport operator has come forward to lease
out the buses for taking the students. Each bus will have a maximum capacity of 50 (excluding 2
seats reserved for the teachers accompanying the students). The school will employ two teachers
for each bus, paying them an allowance of ` 500 per teacher. It will also lease out the required
number of buses. The following are the other cost estimates:

Rent `6500 per bus.


Special permit fee `500 per bus.

Block entrance fee at the planetarium `2500.


Prizes to students for games `500.
No cost are incurred in respect of the accompanying teachers (except the allowance of `500
per teacher).
You are required to PREPARE:

(A) A flexible budget estimating the total cost for the levels of 60, 90,120,150 and 180 students.
Each item of cost is to be indicated separately.
(B) COMPARE the average cost per student at these levels.
(C) WHAT will be your conclusions regarding the break-been level of student if the school
proposes to collect `400 per student?
Question 2:

Anju Limited has collected the following data for its two activities. It calculates activity cost rates
based on cost driver capacity.

The company makes three products A, B and C. For the year ended March 31, 20XX, the following
consumption of cost drivers was reported:

Required:

(A) PREPARE a statement showing cost allocation to each product from each activity.
(B) CALCULATE the cost of unused capacity for each activity.
Question 3:

Following information relate to a manufacturing concern for the year ended 31st March, 2023:

Raw Material (opening) 2,28,000


Raw Material (closing) 3,05,000
Purchases of Raw Material 43,50,000
Freight Inwards 1,20,000
Direct wages paid 12,56,000
Direct wages-outstanding at the 1,50,000
end of the year
Factory Overheads 20% of prime cost
Work-in-progress (opening) 1,92,500
Work-in-progress (closing) 1,40,700
Administrative Overheads (related 1,73,000
to production)
Distribution Expenses ` 16 per unit
Finished Stock (opening)- 1,320 6,08,500
Units
Sale of scrap of material 7,000

The firm produced 14,350 units of output during the year. The stock of finished goods at the
end of the year is valued at cost of production. The firm sold 14,903 units at a price of `579
per unit during the year.
PREPARE cost sheet of the firm.

Question 4:

A hotel having 20 single rooms is having 80% occupancy in normal season (8 months) and 50% in
off- season (4 months) in a year (take 30 days month).
Management wishes to make a margin of 25% of total cost.
Required

(a) CALCULATE the Tariff per room per day.


(b) CALCULATE the break-even occupancy in normal season (in percentage also) assuming there
is 50% occupancy in off-season.

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