Strategic Cost Management:Get Answer Sheet of NMIMS April 2019 assignments Contact us at assignmentssolution@gmail.com

NMIMS Global Access
School for Continuing Education (NGA-SCE)
Course: Strategic Cost Management
Internal Assignment Applicable for April 2019 Examination
Assignment Marks: 30
Instructions:
1. X Ltd has to replace its machine and the production manager has to decide between
Machine A and Machine B. Machine A is having installation cost of 10,000 and
annual electric bill 2000. Machine B has installation cost of 15,000 and annual

electric bill of 1000. If both have life of 8 years which machine will you recommend
if interest rate is 9 %. (10 Marks)
2. A company manufacturing two products furnishes the following data for a year.

Product	Annual Output Units	Machine hours	No. of purchase orders	No. of setups
A	5,000	12,500	160	20
B	50,000	1,25,000	340	50

The annual Overheads are as under:

Volume related activity cost ( Activity driver-Machine hours )	5,50,000
Setup related cost	7,00,000
Purchase related cost	6,20,000

You are required to calculate and compare cost per unit of each product based on
Traditional method of charging overhead and Activity based costing method. (10 Marks)
3. ABC Limited is looking at a Project D with following projected cash flows:

Year	Inflows / (outflow)	P .V Factor @ 15%	P .V Factor @ 20%
0	(240,000)	1.000	1.000
1	25,000	0.870	0.833
2	75,000	0.756	0.694
3	150,000	0.658	0.579
4	150,000	0.572	0.482

Calculate and interpret results
a. NPV at 15 % & 20% (5 Marks)
b. IRR (5 Marks)