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CSS Accountancy and Auditing Paper I Past Paper 2021

CSS Accountancy and Auditing Paper I 2021 carries 100 marks over 3 hours. It has 7 questions.

Marks
100
Time
3 hours
Questions
7

Years

How to attempt: Attempt ONLY FOUR questions from PART-II by selecting TWO questions from EACH SECTION. ALL questions carry EQUAL marks.

Questions

Question 1 (Part I) is the paper's MCQs, which are not reproduced here.

SECTION – I

  1. Q. 2
    You are required to prepare Income Statement for the period ending 31st December, 2019:
    (20)
    Merchandise Opening Inventory.18,000Office Rent Expenses2000
    Sales Discount4,000Traveling Expenses1,300
    Sales Return & Allowances2,000Office Supplies Expense700
    Purchases1,80,000Interest Expense1,700
    Carriage1,600Postage Expense200
    Sales Salaries12,000Insurance Expense400
    Rent Expense-selling1,200
    Advertising expense1,400Sales2,17,000
    Utilities expense-selling900Purchases Discount1,700
    Depreciation exp.-selling400Purchases Return. & Allow.1,300
    Office Salaries8,000Interest Earned3,800
  2. Q. 3
    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.
    (20)

    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. 4
    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.
    (20)

    Required:

    Calculate the following:

    • (A)
      The annual depreciation expense by applying sum of the year digit method.
      (10)
    • (B)
      Pass journal entries and prepare depreciation schedule. Also state the assumptions of this method.
      (10)

SECTION – II

  1. Q. 5
    Attock Engineering Co. Ltd produces machines as per customer’s specifications. The following data pertains to job order no. 1122:
    (20)
    Description: 6 machines.Week ending 14/08week ending 21/08
    Material used Deptt. ARs. 4800Rs.2600
    Direct labor rate Deptt. ARs. 40/ hourRs. 40/ hour
    Labor hour used Deptt A1200800
    Direct labor rate Deptt BRs. 42/ hourRs. 42/ hour
    Labor hour used Deptt.B600280
    Machine hours. Deptt B400240
    Applied FOH Deptt. ARs. 20/ labor hourRs. 20/ labor hour
    Applied FOH Deptt. BRs. 18/ machine hourRs. 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.

  2. Q. 6
    Volter company’s contribution format income statement for the recent year is given below:
    (20)
    Total (Rs.)Per unit (Rs.)% of sales
    Sales (20,000) units1,200,00060100%
    Less Variable Exp.900,00045?%
    Contribution margin300,00015?%
    Less fixed Exp.240,000
    Operating income60,000

    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)
  3. Q. 7
    Brooks Inc. uses process costing. The costs for Department 2 for April were:
    (20)
    Cost from preceding departmentRs.20,000
    Cost added by department:
    MaterialsRs.21,816
    Labor7,776
    FOH4,10433,696

    The following information was obtained from the department's quantity schedule:

    Units received5,000
    Units transferred out4,000
    Units still in process1,000

    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.

  4. Q. 8
    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.
    (20)

    Required:

    • (A)
      Determine the predetermined overhead rate.
      (10)
    • (B)
      What is the overhead applied during the year?
      (10)
  1. Part-II is to be attempted on the separate Answer Book.
  2. Attempt ONLY FOUR questions from PART-II by selecting TWO questions from EACH SECTION. ALL questions carry EQUAL marks.
  3. All the parts (if any) of each Question must be attempted at one place instead of at different places.
  4. Write Q. No. in the Answer Book in accordance with Q. No. in the Q.Paper.
  5. No Page/Space be left blank between the answers. All the blank pages of Answer Book must be crossed.
  6. Extra attempt of any question or any part of the question will not be considered.
  7. Use of Calculator is allowed.