| |
|
|
Q.1 |
This was an
easy question and many students secured full marks. However
in a number of cases, students made the mistake of taking
contribution margin instead of C/S ratio as the basis of
selection of product mix. Such mistakes from finalists betray
their poor knowledge. |
|
|
|
|
|
In part (iii),
the common mistake was that sale of product C was avoided
as it gave a negative contribution. The question was very
clear that the sale of products can only be varied up to
10% either up or down and stopping the sale of product C
meant 100% reduction. Students are advised to read the question
carefully as such mistakes lead to loss of valuable marks. |
|
|
|
|
Q.2 |
Majority made
a very simple question difficult, by irrelevant assumptions
and calculations. Revised profits were to be calculated
by adding depreciation and deleting rental. The new capital
employed was to be arrived at by deleting the NBV of factory
from the existing capital employed. The most common mistakes
were:
|
|
|
- Many students did not add back depreciation to the
existing profit.
|
|
|
- Depreciation was calculated on the new assessed value
of factory.
|
|
|
- Revaluation reserves was
included in “Capital Employed”.
|
|
|
|
|
Q.3 |
Except for a
few candidates, the performance was extremely bad. The first
requirement of the question was quarterly budget for cost
of goods manufactured. Instead the students worked out the
cost of goods sold and its breakdown into material labour and variable overhead.
Stock
of finished goods was wrongly valued either at sales value
or at cost inclusive of fixed cost whereas it was clearly
mentioned in the question that it is to be valued at prime
cost plus variable overheads.
|
|
|
|
|
|
The presentation
of cash budget was extremely poor. In some cases it was
not even presented in proper columnar form. Some of the
students made an yearly budget.
In most cases depreciation was deducted from variable overheads.
Some seemed to be confused about the bank interest included
in the overheads. In this question not only the marks were
lost but also a lot of time was wasted, affecting the time
allotted for other questions. |
|
|
|
|
Q.4 |
A well attempted
question except that in a few cases it was seen that the
question was partly worked out with incremental figures
and partly with total figures. Such working lead to confusion
and errors in certain cases. |
|
|
|
|
Q.5 |
A well attempted
question with many securing full marks. |
|
|
|
|
Q.6 |
(a) |
Except for a
few students none could calculate the equivalent chargeable
hours. Common mistakes were:
|
|
|
|
- Available time was calculated for a single person,
instead of two persons i.e. G & H.
|
|
|
|
- Idle time should have been 22.5% of available time,
but it was taken as 22.5% of the time available after
adjustment of 25% of time for own
business.
|
|
|
|
- Traveling time should have been charged at 1/3rd
of normal hourly rate. This point was ignored by most
of the students.
|
|
|
(b) |
Most of the
points considered were repetitive and irrelevant like hiring
of proper accounting staff, appropriate accounting methods,
etc.
|
|
|
(c) |
Majority of
the students could not understand the requirement of the
question and tried to explain Activity Based Costing System. |
|
|
|
|
|
Q.7 |
Many students
got full marks in this question. The common mistakes were:
|
|
|
|
- Overtime premium was ignored.
|
|
|
|
- By using Catossium Pyanide, the charges that would have been incurred
on its safe disposal were saved. Instead of taking it
as a saving, the students added it to costs.
|
|
|
|
- Fixed cost was considered as relevant cost.
|
|
|
|
- Replacement cost of CB500 was considered as irrelevant.
|
