MCQ for CA Final SCMPE - Chapter 3 Cost Management Techniques

Sample Multiple Choice Questions (MCQ's) for CA Final - Paper 5 - Strategic Cost Management and Performance Evaluation - Chapter 3: Cost Management Techniques - For Practice relevant for May/Nov 23 Examinations

 

Q:1 A chemical company produces two chemicals SX and ZX. Environmental activities and costs associated with the two chemicals are as follows;

 

SX

ZX

Unit produced (kg)

6,00,000

15,00,000

Packing Materials (kg.)

80,000

40,000

Energy Usage (KWH)

60,000

30,000

Toxin releases (Pounds into the air)

2,00,000

40,000

Pollution control machine hours

32,000

8,000

 

Cost of environmental activities:

 

Packing material Costs

₹ 3,60,000

Energy Costs

₹ 96,000

Fines for release of toxins into the air

₹ 48,000

Operating costs of pollution control equipment

₹ 1,12,000

 

CALCULATE the environmental cost per kilogram for each chemical produced by the company

Packing Material Costs for Chemical SX

 

  1. 120000
  2. 180000
  3. 240000
  4. 260000

Answer: 1

 

Q:2 The following information is given about the type of defects during a production period and the frequencies of their occurence in a spectacle manufacturing company

Defect

No. of Instances

End Frame not equidistant from the center

10

Non-uniform grinding of lenses

60

Power mismatches

20

Scratches on the surface

110

Spots/Stains on lenses

5

Rough edges of lenses

70

Frame colour-shade differences

25

PREPARE a frequency table to construct Pareto Chart for the defect type.

Calculate % to total Defects of:- Scratches on the surface

 

  1. 40%
  2. 15.5%
  3. 23.33%
  4. 36.67%

Answer: 4

 

Q:3 The following information is given about the type of defects during a production period and the frequencies of their occurence in a spectacle manufacturing company

Defect

No. of Instances

End Frame not equidistant from the center

10

Non-uniform grinding of lenses

60

Power mismatches

20

Scratches on the surface

110

Spots/Stains on lenses

5

Rough edges of lenses

70

Frame colour-shade differences

25

PREPARE a frequency table to construct Pareto Chart for the defect type.

Calculate % to total Defects of:- Frame colours - shade differences

 

  1. 10.34%
  2. 6.67%
  3. 3.33%
  4. 15%

Answer: 3

 

Q:4 The following information is given about the type of defects during a production period and the frequencies of their occurence in a spectacle manufacturing company

Defect

No. of Instances

End Frame not equidistant from the center

10

Non-uniform grinding of lenses

60

Power mismatches

20

Scratches on the surface

110

Spots/Stains on lenses

5

Rough edges of lenses

70

Frame colour-shade differences

25

PREPARE a frequency table to construct Pareto Chart for the defect type.

Calculate % to total Defects of :-

End frame not equidistant from the center

 

  1. 3.33%
  2. 6.67%
  3. 12%
  4. 10%

Answer: 1

 

Q:5 Great Eastern Appliances Ltd. (GEAL) manufactures consumer durable products in a very highly competitive market. GEAL Is considering launching a new product Kitchen Care' into the market and gathered the following data:

Expected Market Price……………………………………………………………₹ 5.00 per unit

Direct Material Cost……………………………………………………………….₹ 1,850 per unit

Direct Labour Cost…………………………………………………………………₹ 80 per hour

Variable Overhead Cost…………………………………………………………..₹ 1,000 per unit

Packing Machine Cost (specially to be purchased for this product)............................................................................................₹ 5,00,000 

GEAL expects the selling price for the new product will continue throughout the product's life and a total of 1,000 units can be sold over the entire lifetime of the product.

Direct labour costs are expected to reduce as the volume of output increases due to the effects of 80% learning curve (index is -0.3219). The expected time to be taken for the first unit is 30 hours and the leaming effect is expected to end after 250 units have been produced. Units produced after first 250 units will take the same time as the 250th unit.

CALCULATE the expected total labour hours over the lifetime of the product ‘Kitchen Care’

 

  1. 2,923.25 hours
  2. 3,553.25 hours
  3. 3,953.25 hours
  4. 3,053.25 hours

Answer: 3

 

CA Final - Paper 5 - SCMPE - Chapter 4   

 

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