CSS Accounting and Auditing Past Paper 2021

Instructions specific to this paper

• Attempt ONLY FOUR questions from PART-II by selecting TWO questions from EACH SECTION.
• Use of Calculator is allowed.
• Attempt ONLY FOUR questions from PART-II by selecting at least ONE question from EACH

Questions

1. Q. 220 marks

   You are required to prepare Income Statement for the period ending 31st December, 2019: Merchandise Opening Inventory. 18,000 Office Rent Expenses 2000 Sales Discount 4,000 Traveling Expenses 1,300 Sales Return & Allowances 2,000 Office Supplies Expense 700 Purchases 1,80,000 Interest Expense 1,700 Carriage 1,600 Postage Expense 200 Sales Salaries 12,000 Insurance Expense 400 Rent Expense-selling 1,200 Advertising expense 1,400 Sales 2,17,000 Utilities expense-selling 900 Purchases Discount 1,700 Depreciation exp.-selling 400 Purchases Return. & Allow. 1,300 Office Salaries 8,000 Interest Earned 3,800

2. Q. 320 marks

   A, B are two partners sharing profits and losses in the ratio of 3:1. They admit K as a partner and he pays Rs. 30,000 as capital. The new ratio is to be 3:1:1. The goodwill of the firm is to be based on 3 years’ purchase of the average 4 years’ profits which are Rs. 15,000, 12,000, 18,000, 19,000. Required: Show the journal entries, if: (A) K pays for the goodwill in cash. (10) (B) He is unable to bring the cash for the goodwill. (10)

3. Q. 410 marks

   XYZ purchased a delivery truck for the distribution of its finished products for Rs. 65,000 on 1st January, 2013. The expected useful life of that truck was five years and a salvage value of Rs. 5,000. Required: Calculate the following: (A) The annual depreciation expense by applying sum of the year digit method. (B) Pass journal entries and prepare depreciation schedule. Also state the assumptions (10) (20) of this method.

4. Q. 520 marks

   Attock Engineering Co. Ltd produces machines as per customer’s specifications. The following data pertains to job order no. 1122: Description: 6 machines. Week ending 14/08 week ending 21/08 Material used Deptt. A Rs. 4800 Rs.2600 Direct labor rate Deptt. A Rs. 40/ hour Rs. 40/ hour Labor hour used Deptt A 1200 800 Direct labor rate Deptt B Rs. 42/ hour Rs. 42/ hour Labor hour used Deptt.B 600 280 Machine hours. Deptt B 400 240 Applied FOH Deptt. A Rs. 20/ labor hour Rs. 20/ labor hour Applied FOH Deptt. B Rs. 18/ machine hour Rs. 18/ machine hour Marketing and administrative costs are charged to each order @ 20% of the cost to manufacture. Required: Prepare job order cost sheet. Calculate sales price of the job, assuming that it has been contracted with a mark-up of 40% of cost.

5. Q. 620 marks

   Volter company’s contribution format income statement for the recent year is given below: Total (Rs.) Per unit (Rs.) % of sales Sales (20,000) units 1,200,000 60 100% Less Variable Exp. 900,000 45 ?% Contribution margin 300,000 15 ?% Less fixed Exp. 240,000 Operating income 60,000 Management is anxious to improve the company’s profit performance and has asked you for an analysis of number of items. Required: (A) Compute the company’s CM ratio and variable expense ratio. (10) (B) Compute the company’s breakeven point in both units and sales rupees. (10)

6. Q. 720 marks

   Brooks Inc. uses process costing. The costs for Department 2 for April were: Cost from preceding department Rs.20,000 Cost added by department: Materials Rs.21,816 Labor 7,776 FOH 4,104 33,696 ----- The following information was obtained from the department's quantity schedule: Units received 5,000 Units transferred out 4,000 Units still in process 1,000 The degree of completion of the work in process as to costs originating in department 2 was: 50% of units were 40% complete; 20% were 30% complete; and the balance were 20% complete. Required: The cost of production report for Department 2 for April.

7. Q. 820 marks

   When setting its predetermined overhead application rate, Tasty Inc. estimated its overhead would be Rs.75,000 and manufacturing would require 25,000 machine hours in the next year. At the end of the year, it found that actual overhead was Rs.74,000 and manufacturing required 24,000 machine hours. Required: (A) Determine the predetermined overhead rate. (10) (B) What is the overhead applied during the year? (10)

Standard FPSC instructions

Printed on this and every CSS paper.

• Part-II is to be attempted on the separate Answer Book.
• All the parts (if any) of each question must be attempted at one place instead of at different places.
• Write Q. No. in the Answer Book in accordance with Q. No. in the question paper.
• No page/space be left blank between the answers. All the blank pages of the Answer Book must be crossed.
• Extra attempt of any question or any part of the attempted question will not be considered.