NPTEL Cost Accounting Week 2 Assignment Answers 2024

1. The company is incurring losses as selling price is below average cost. The management is thinking of temporary discontinuance of operations. Selling price per unit is Rs. 5, Fixed cost per unit is Rs. 6 and variable cost per unit is Rs. 8. Then it is

better to continue because the losses are minimized
better to continue because the profits are maximized
better to discontinue because the losses are maximized
better to discontinue because the profits are minimized
None of the above

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2. In make-or-buy decisions, which cost is irrelevant?

Fixed overhead costs that will remain unchanged regardless of the decision
Direct labour costs if the product is made in-house
Purchase cost if the product is bought externally
Variable overhead costs incurred if the product is made in-house
None of the above

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3. Which of these is a Joint Cost Allocation method?

Fixed Cost units’ method
Profit value at split off point
Sale value at split off point
Variable cost split off point
None of the above

Answer :-

4. Common data for Q4 to Q6: Swastik Ltd. sells bucket. The company has the following expenses and revenues at 40% capacity:

If the company decided to work the factory at 60% capacity, the selling price falls by 3%. If factory work 95% at capacity the selling price falls by 5%.

4. What is the profit or loss if factory work at 60% capacity

Profit of Rs. 40000
Profit of Rs. 72000
Loss of Rs. 72000
Loss of Rs. 40000
None of the above

Answer :-

5. Calculate the break-even point in units at 95% capacity

7500.0
6500.0
8000.0
7800.0
None of the above

Answer :-

6. What is the profit or loss if factory work at 95% capacity?

Loss of Rs. 1,23,000
Profit of Rs. 1,42,500
Loss of Rs. 1,30,000
Profit of Rs. 1,30,000
None of the above

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7. Common data for Q7 to Q10: Krishna Ltd. maintains a margin of safety of 35% with an overall PV ratio of 25%. Its fixed costs amount to Rs. 4,00,000,

7. Calculate the break-even sales