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412, Strategic Cost Management Assignment: Dr. D. Y. Patil Unitech Society's

The document is an assignment for a finance specialization MBA course. It contains 3 questions related to strategic cost management - calculating lifecycle cost per unit for a new product, overhead cost rates and allocation for a new product, and material variances for a chemical mixture.

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aKSHAT sHARMA
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57 views1 page

412, Strategic Cost Management Assignment: Dr. D. Y. Patil Unitech Society's

The document is an assignment for a finance specialization MBA course. It contains 3 questions related to strategic cost management - calculating lifecycle cost per unit for a new product, overhead cost rates and allocation for a new product, and material variances for a chemical mixture.

Uploaded by

aKSHAT sHARMA
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Dr. D. Y.

Patil Unitech Society’s


Dr. D.Y. PATIL INSTITUTE OF MANAGEMENT & RESEARCH, PUNE
Sant Tukaram Nagar, Pimpri, Pune-411018, Maharashtra, India.
(Approved by All India Council for Technical Education & Recognized by the Savitribai Phule Pune
University)

MBA II, SEM IV, Finance Specialization

412, Strategic Cost Management


Assignment
Marks 30 Last Date of Submission: 5th August

1) A company is planning a new product. Market research information suggests that the product
should sell 10,000 units at 21/unit. The company seeks to make a mark- up of 40% product
costs. It is estimated that the lifetime costs of the product will be as follows

1. Design and development costs 50,000


2. Manufacturing costs 10/unit
3. End of life costs 20,000 Required :
What is the original lifecycle cost per unit?
2) A manufacturing company has set up 5,000 machines, with an overhead of £11,000. 300 of
these new machines are for new product
Calculate
Cost driver rate
Overhead costs for new product

3) The standard cost of a chemical mixture is as thus:

40% material C at RS 20 per kg


60% material D at RS 30 per kg
A standard loss of 10% of input is expected in production
The cost records for a period showed the following usage:
90 Kgs of material C at a cost of Rs 18 per kg
110 kgs of material D at Rs 34 per kg
The quantity produced was 182 kgs of good product. Calculate all possible material
variances

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