NMIMS Solved Assignment Cost & Management Accounting December 2025

NMIMS Solved Assignment Cost & Management Accounting Dec 2025 :  [Unique]
NMIMS Solved Assignment Cost & Management Accounting Dec 2025 :

NMIMS Centre for Distance and Online Education (NCDOE)
Course: Cost & Management Accounting
Internal Assignment Applicable for Dec 2025 Examination

Assignment Marks: 20
Instructions
PLEASE NOTE: This assignment is application based, you have to apply what you have
learnt in this subject into real life scenario. You will find most of the information through
internet search and the remaining from your common sense. None of the answers appear
directly in the textbook chapters but are based on the content in the chapter
NMIMS Centre for Distance and Online Education (NCDOE)
Course: Cost & Management Accounting

Q1 A factory produces a single product. The following information relates to the month
of March:
– Standard labour time per unit = 2.0 hours.
– Standard labour rate = Rs.100 per hour.
– Actual production = 1,000 units.
– Actual hours worked (including idle time) = 2,200 hours.
– Idle time during the period = 100 hours (paid but unproductive).
– Actual average labour rate paid = Rs.95 per hour.
Overheads:
– Budgeted fixed factory overheads = Rs.1,00,000 per month.
– Budgeted variable factory overheads = Rs.20 per productive hour.
The overhead absorption basis is labour hours; standard hours for absorption =
hours required for actual output (i.e., 2.0 hr × 1,000 units).
–
– Actual fixed overheads incurred = Rs.1,10,000.
– Actual variable overheads incurred = Rs.46,000.
Required:
(a) Calculate the standard labour cost for the output, actual labour cost,
labour rate variance, labour efficiency variance.
(b) Compute the overhead absorption rate per hour, overheads absorbed,
and state whether overheads are over- or under-absorbed and by how much.
(c) Suggest two control measures (brief) — one for labour cost control and one
for overhead control. (1 mark)
(10 Marks)
Q2 (A) A manufacturing company is reviewing its inventory valuation methods. The finance
team notes that FIFO and LIFO, each impact reported profits, tax liabilities, and
inventory values differently, especially during periods of volatile material prices. The
operations team is concerned about the complexity of calculations and the alignment
with actual material flows. The management team must decide which method best
supports both financial reporting and operational needs. Evaluate the implications of
choosing between FIFO, LIFO for inventory valuation in a manufacturing company
experiencing frequent price fluctuations. How should management decide which
method to adopt, and what improvements would you suggest to ensure both financial
accuracy and operational efficiency?
(5 Marks)
Q2 (B) A textile mill’s spinning department reported an abnormal gain this quarter, with
actual production surpassing the normal output due to enhanced worker efficiency
and minor process improvements. While this has led to lower per-unit costs and
higher reported profits, the finance director is concerned about whether this gain is
sustainable and how it should influence future budgeting, cost estimation, and
operational planning. Assess the managerial response to an abnormal gain in a textile
mill’s spinning process, where actual output exceeded expected levels due to
improved worker efficiency. How should management adjust future cost estimates
and operational strategies in light of this abnormal gain, and what are the potential
risks of misinterpreting such gains in process costing?
(5 Marks)