NATIONAL OPEN UNIVERSITY OF NIGERIA
PLOT 91, CADASTRAL ZONE, NNAMDI AZIKIWE EXPRESSWAY, JABI, ABUJA FACULTY OF MANAGEMENT SCIENCES
2020_1 EXAMINATION
COURSE CODE: ACC306 CREDIT UNIT: 3 COURSE TITLE: COST ACCOUNTING
TIME ALLOWED: 21/2HOURS
INSTRUCTIONS: 1. Attempt question Number one (1) and any other three, four questions in all
2. Question number 1 is compulsory and carries 25 marks, while the other questions carry 15 marks each
3.
Present all your points in coherent and orderly manner
Question 1
a) Briefly discuss ‘direct expenditure’ in relation to cost accounting and compare it with indirect expenditure
b) Explain the relevance of coding or code number in material costing
c) Highlight five advantages of break-even analysis. Use the following question to support your answer: Mande is a manufacturing company, located in Kaduna. The company produces exercise books for junior secondary school, the cost data for the production of one unit is given as:
Selling price N30
Variable cost N18
Fixed cost N120,000 You are required to calculate:
i) Number of units that will produce break-even point
ii) Sale value to attain break-even point
iii) Contribution to sales ratio
iv) Number of units to be sold to make a target profit of N60,000 and
v) Sales in naira value to make a profit of the N60,000
Question 2
Identify the various methods of valuing materials and explain any three of them
Question 3
a) In organization for wages control, discuss ‘recording gate times’
b) In labour remuneration methods:
i) When will you recommend for the adoption of payment based on time or day-rate wages, which is based on the time employed and
ii) State the advantages of payment by results
Question 4
i) Explain the difference between absorption costing and overhead absorption
ii) Highlight the fundamental differences between cost accounting and financial accounting
Question 5
a) In detail, explain the costing term ‘integrated account’
b) What is the prime purpose of a cost statement and what should be borne in mind in preparing such statement?
c) Itemize any five advantages of operating central stores as compared with sub-stores
Question 6
a) Itemize the suggested operation or routing of goods received note
b) Discuss i) the relevance of coding or code number in materials transactions and ii) Checking inward invoices
