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Cost & Management Accounting December 2026 Solved Assignment

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Cost & Management Accounting

December 2026 Examination

 

 

Q1    A manufacturing company provides the following information for the production of 10,000 units during the year:

 

Particulars Amount (Rs.)
Opening Stock of Raw Materials 30,000
Purchases of Raw Materials 2,40,000
Carriage Inwards 10,000
Closing Stock of Raw Materials 40,000
Direct Wages 1,20,000
Direct Expenses 20,000
Factory Overheads 1,00,000
Opening Work-in-Progress 30,000
Closing Work-in-Progress 20,000
Office & Administrative Overheads 60,000
Opening Finished Goods 50,000
Closing Finished Goods 30,000
Selling & Distribution Overheads 60,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The company follows a cost-sheet approach for determining product cost and pricing. Prepare a Cost Sheet showing Prime Cost, Factory/Works Cost, Cost of Production, Cost of Goods Sold and Cost of Sales. Calculate the cost per unit and determine the selling price per unit if the company wants to earn a profit of 20% on cost.

(10 Marks)

 

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Q2 (A) A manufacturing company is facing rising costs, inefficient resource utilisation and increasing competition. The Managing Director believes that financial accounting information alone is sufficient to address these issues. The newly appointed Management Accountant disagrees and recommends using management accounting information for managerial decisions.

Evaluate the Management Accountant’s recommendation by explaining how management accounting information can support planning, resource allocation, monitoring and control, and operational decision-making in this situation.

(5 Marks)

 

Q2 (B)  A diversified manufacturing and engineering company receives the following three assignments:

  • Assignment A: Manufacture a customised machine according to the specifications of one customer.
  • Assignment B: Manufacture 1,000 identical electronic components together as one production lot.
  • Assignment C: Execute a two-year construction project at the customer’s

Analyse the nature of each assignment and recommend whether Job Costing, Batch Costing or Contract Costing should be applied in each case. Justify each recommendation based on the nature of the cost unit, production/order characteristics and duration of the work.

(5 Marks)

 

 

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