Cost and Management Accounting

Write any two limitations of cost accounting.

Define the indirect cost with an example.

Define "Just in Time" inventory policy.

Write down the meaning of labour turnover.

What is normal loss?

A manufacturing company provides you the following information:

• Total cost at economic order quantity: Rs. 3,000
• Ordering cost per order: Rs. 60
• Cost per unit of material: Rs. 20
• Carrying cost is 10% of inventory value. Required: Annual requirement.

The following data are given to you:

• Standard time allowed: 160 hrs
• Actual time taken: 140 hrs
• Wage rate per hour: Rs. 20 Required: Bonus under Rowan premium plan.

A Company Ltd. is working now at its annual normal capacity of 10,000 units. The total cost per unit is Rs. 50. The annual fixed costs are Rs. 160,000. Required: Total cost at 80% of the normal capacity.

The following information is available in respect of a material.

• Maximum stock level = 20,000 units
• Consumption per day = 2,000 - 3,000 units
• Re-order period = 4 - 6 days Required: Reorder quantity.

Following particular are provided:

• Cost of selection: Rs. 30,000
• Training cost: Rs. 24,000
• Cost of welfare services: Rs. 26,000
• Loss due to inefficiency of new workers: Rs. 10,000
• Average no. of workers: 50
• No. of workers replaced: 100 Required: Replacement cost per employee.