Dear Students,
Posting Suggested Answers for AMA CA - Final, May 2017. I tried my best to make them Accurate, Easy to understand and presentable with exams oriented approach. I hope this will help you to understand the manner of solving and presenting such a lengthy paper like AMA. Best of luck for your results.
Great work.
Thanks Sir
Thanks Pradyumn for noticing such small tying errors. I had rectified both of these errors. I am attaching updated pdf file with this reply. Please also tell me whether these solution are helpful to you.
Hello Joseph,
Thanks for downlloading the solutions. As far as question 7 (e) is concerned the answer provided is correct in my opinion.
(i) R & D cost: although the company is planning to incurr, but still such R & D is being done only for the purpose of testing compatibility (Technical Feasibility). The product can be produced only after that and the company can expect revenue. so it is nessesary to perform such test. In other words it can not be avoided. so it can be termed as Comitted Cost. But we have to classify the same, only among the categories mentioned in the question. That's why I had classified the same as Sunk Cost.
(ii) Profit of Telephone Instrument Division: Yes it is Opportunity Cost and the Term Notional Cost is just only an another name of Opportunity Cost.
Thank You Again,
Please rate the usfulness of these Solutions.
Hello Gopal,
Sorry, but Your answer is Not Correct. It is specifically mentioned in the question itself that other material will have a normal loss of 4% and normal loss is always be a part of Total Cost. Hence Other Materials Cost is required to be adjusted with such normal loss.
Although you may take royalty payable as a part of Target Cost.
sir can you please post suggested answers of ama for may 2018 exams
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