Costing Marathon.pdf

CA Inter (IPC)

COSTING 1 Day Marathon Revision

CA RAHUL GARG B.COM, FCA, LCS, ACMA, DISA (ICAI), CFA (ICFAI), MBA, ADV. DIP. MGT. ALL INDIA RANKHOLDER in CA, CS, CMA (incl. AIR 1) GOLD MEDALIST

Faculty for CA Inter COSTING & Indirect

Tax (GST) at Swapnil Patni Classes

Live Classes at Pune & Virtual Classes Across India

Tribute to my Beloved Elder Brother

SACHIN GARG (Inspiration for me and all my students) who left for heavenly abode on 3rd May, 2015

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

Powered by TCPDF (www.tcpdf.org)

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A brief about Rahul Garg 1.

Broke LIMCA BOOK OF RECORDS by being youngest in India to clear all the 3 professional courses CA, CS, CMA at the age of 22 years 7 months with Ranks (A Record).

2.

5 times All India Rankholder in Professional Exams (A Record).

3.

Scored SINGLE DIGIT RANK 3 times (including All India Rank 1).

4.

Undisputed achiever of all 3 professional exams with ALL INDIA RANK in ALL.

5.

Achieved exemption in 40+ papers out of total 50 papers held by CA, CS, CMA institutes in his academic career.

6.

Awarded by Mr. Atal Bihari Vajpayee in 2010 for exceptional performance in Academics.

7.

One of the best motivator in India.

8.

Covered by the National Magazine ‘Career 360’ amongst 12 National Toppers in 2010.

9.

Specialist in Time management and Stress management skills.

Love for the subject COST ACCOUNTING 1.

First in India to provide Multi Colour Theory notes in Cost FM.

2.

Tabular and Diagrammatic presentation of Theory to create interest.

3.

Important points of theory Specially marked for last minute revision.

4.

Simple and lucid language in theory for easy understanding.

5.

Only one in India to cover more than 2000 Practical Questions in Cost FM.

6.

More than 90% coverage of Practical Questions in CA IPCC Exams since May 2014 from Rahul sir’s notes.

7.

His student Shareshtha Kadian scored 91 Marks in Cost FM in May 2016.

8.

Focus on 100% conceptual clarity and maximum practice of questions.

9.

Special focus on Presentation and “How to Attempt” to score more than average marks.

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | ii

RANK Certificate for All India Rank 41 (May 06) in CA PE II Exam (now CA Inter)

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | iii

RANK Certificate for All India Rank 4 (June 08) in CS Inter Exam

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | iv

RANK Certificate for All India Rank 13 (June 09) in CS Professional (Final) Exam

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

Page |v

RANK Certificate for All India Rank 1 (June 08) in CMA Inter Exams

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | vi

Institute’s Gold Medal for All India Rank 1 (June 08) in CMA Inter Exams

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | vii

RANK Certificate for All India Rank 3 (June 09) in CMA Final Exams

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

P a g e | viii

CA IPC NOVEMBER 2017 QUESTION PAPER ANALYSIS (held on 7 NOVEMBER 2017) 100 % COVERAGE of QUESTIONS from RAHUL Sir’s BOOK All Practical Questions were solved in class. All Theory covered in Costing Gatha Book

Analysis of CA IPC NOVEMBER 2017 COST FM PAPER by CA RAHUL GARG Question

Subject

Chapter

1

a b c d

Cost Cost FM FM

Labour Costing Contract Costing Time Value of Money Capital Structure

Theory/ Practical Practical Practical Practical Practical

Marks

Question No. in Rahul Sir' Book

5 5 5 5

Similar to Q 46 of Class Book Similar to Q 14 of Class Book Similar to Q 5 of Class Book Similar to Q 14 of Class Book

2

a b

Cost FM

JP BP Capital Budgeting

Practical Practical

8 8

Similar to Q 16 of Class Book Similar to Q 22 of Class Book

3

a b

Cost FM

Standard Costing Debtor Management

Practical Practical

8 8

Similar to Q 4 of HW Book Similar to Q 7 of HW Book

4

a b

Cost FM

Marginal Costing Leverage

Practical Practical

8 8

Similar to Q 40 of Class Book Similar to Q 14 of Class Book

5

a b c d

Cost Cost FM FM

Basic concepts Cost Accounting System Debtor Management Capital Budgeting

Theory Theory Theory Theory

4 4 4 4

Same as Q 13 of Costing Gatha Concept Covered in Costing Gatha Same as Q 4 of FM Gatha Concept Covered in FM Gatha

6

a b

Cost FM

Overheads Ratio Analysis

Practical Practical

8 8

Similar to Q 21 of Class Book Similar to Q 15 of Class Book

7

a b ci cii d e

Cost Cost Cost FM FM FM

Material Costing Contract Costing Budgetary Control Sources of Finance Cash Management Basic concepts

Theory Theory Theory Theory Theory Theory

4 4 2 2 4 4

Concept Covered in Costing Gatha Same as Q 3 of Costing Gatha Same as Q 2 of Costing Gatha Same as Q 5 of FM Gatha Same as Q 5 of FM Gatha Concept Covered in FM Gatha

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

CA INTER MAY 2018 QUESTION PAPER ANALYSIS (held on 7 May 2018) Question

Chapter

1

a

2

3

4

5

7

Marks

Question No. in Rahul Sir' Book

Material

Theory/ Practical Practical

5

Similar to Q 15 of Class Book

b

Labour

Practical

5

Similar to Q 40 of Class Book

c

Marginal

Practical

5

Similar to Q 29 of Home Book

d

Reconciliation

Practical

5

Similar to Q 1 of Class Book

a

Cost Sheet

Practical

10

Concept Similar to Q 20 of Class Book

b

Contract

Practical

10

Similar to Q 25 of Class Book

a

Labour

Practical

10

Similar to Q 3 of Class Book

B

Process

Practical

10

Similar to Q 9 of Home Book

a

Activity Based Costing

Practical

10

Similar to Q 30 of Class Book

b

Service Costing

Practical

10

Extra Question Done in Class

a(i)

Material

Practical

5

Similar to Q 31 of Home Book

a(ii)

Standard

Practical

5

Similar to Q 6 of Class Book

b

Marginal

Practical

10

Similar concept Qs done in class

a

Basic Concepts

Theory

5

Concept Covered in Costing Gatha

b

Material

Theory

5

Concept Covered in Costing Gatha

c

Budgetary

Theory

5

Concept Covered in Costing Gatha

d

Job Costing

Theory

5

Concept Covered in Costing Gatha

e(i)

Basic Concepts

Theory

2.5

Concept Covered in Costing Gatha

e(ii)

Material

Theory

2.5

Concept Covered in Costing Gatha

100 % COVERAGE of QUESTIONS from RAHUL Sir’s BOOK All Practical Questions were solved in class. All Theory covered in Costing Gatha Book

CA RAHUL GARG B.COM, FCA, LCS, ACMA, DISA (ICAI), CFA (ICFAI), MBA, ADV. DIP. MGT.

ALL INDIA RANKHOLDER in CA, CS, CMA (incl. AIR 1) GOLD MEDALIST

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GSTThe Game Changer LIVE BATCH By

CA RAHUL GARG All India Rankholder in all 3 professional degrees CA CS CMA Gold Medalist (AIR 1)

From 9th April Time- 2:00 - 5:00 pm Special featuresColor Notes Analysis of each section supported by Bare Act provisions Word by Word Logical Analysis of all sections More than 500 Questions of Theory & Practical Simple & lucid language Syllabus completion on time (100%)

Aim To Score 40/40

1.Broke LIMCA BOOK OF RECORDS by being youngest in India to clear all the 3 professional courses CA, CS, CMA at the age of 22 years 7 months. 2.Awarded by Mr. Atal Bihari Vajpayee in 2010 for exceptional performance in Academics. 3.Special Time management, Stress management and Motivational skills

Page |1

LEVY AND COLLECTION OF TAX The incidence of tax is the foundation stone of any taxation system. It determines the point at which tax would be levied, i.e. the taxable event. Under the old regime, taxable events for various taxes were different. For example for excise, the taxable event was manufacture or production of goods in India, for service, the taxable event was provision of service and under VAT/ CST it was sale of goods. To replace such multiplicity, GST has brought a single and unified taxable event which is supply, i.e., tax would be payable on the supply of goods or services. Provisions regarding above are contained in

CGST Act Chapter III - Levy and Collection of Tax Scope of supply Tax liability on composite and mixed supplies Schedules Activities to be treated as supply even if made without consideration Activities to be treated as supply of goods or supply of services Activities or transactions which shall be treated neither as a supply of goods nor a supply of services

Section 7 Section 8 I II III

Bare Text of Section 7 (1) For the purposes of this Act, the expression “supply” includes–– (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business; (c) the activities specified in Schedule I, made or agreed to be made without a consideration; and (d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. (2) Notwithstanding anything contained in sub-section (1),–– (a) activities or transactions specified in Schedule III; or (b) such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council, shall be treated neither as a supply of goods nor a supply of services. (3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as— (a) a supply of goods and not as a supply of services; or (b) a supply of services and not as a supply of goods.

Basics… The term, “supply” has been inclusively defined in the Act. The meaning and scope of supply under GST can be understood in terms of following six parameters, which can be adopted to characterize a transaction as supply: 1. Supply of goods or services. Supply of anything other than goods or services does not attract GST. 2. Supply should be made for a consideration. 3. Supply should be made in the course or furtherance of business. 4. Supply should be made by a taxable person. 5. Supply should be a taxable supply. 6. Supply should be made within the taxable territory

Analysis of Section 7(1)(a) Supply includes all forms of supply of goods or services or both such as sale, transfer, barter, Provision exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business.

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

Page |2

Sale

Meaning

Modes of Supply The term sale was defined under various state VAT laws. Sale means a sale of goods made within the State for cash or deferred payment or other valuable consideration but does not include a mortgage, hypothecation, charge or pledge. Sale involves transfer of property in goods from one person to another person for consideration. Under CGST Law sale is treated as supply leviable to GST. However, the definition of Sale has not been provided under the GST Law.

Example

Mr. X sold laptop worth Rs. 1,00,000 and issued invoice in favour of Mr. Y. Now ownership in laptop transferred to Mr. Y. Such transaction shall be covered in sale. It is a supply of goods leviable to GST.

Transfer

Meaning

The definition of Transfer has not been provided under the GST Law. The term transfer means, where the ownership may not be transferred but the right in the goods is transferred.

Example

Mr. A is the owner of Xerox machine. He transferred the right to operate the Xerox machine to Mr. B for a consideration of Rs. 10,000 per month for four months. Hence, ownership of the machine is not transferred but the right in the machine is transferred. It is supply of service leviable to GST.

Barter

Meaning

Barter means the exchange of goods and productive services for other goods and productive services, without the use of money.

Example

Mr. C, a practicing Chartered Accountant provided services to M/s A Ltd., dealer of laptops. In return M/s A Ltd. gave a laptop to Mr. C. Here, twoway supply takes place. Mr. C is making taxable supply of service and M/s A Ltd., is making taxable supply of goods. Hence, tax is payable by both.

Exchange

Meaning

When two persons mutually transfer the ownership of one thing for the ownership of another, neither thing nor both things being money only, the transaction is called an exchange. Exchange offers on products such as televisions, mobile phones and refrigerators are leviable under GST.

Example

Mr X is a dealer of new cars. He sells new cars for Rs. 8,25,000 but agrees to reduce Rs. 1,25,000 on surrendering of old car. Mr. Y who intends to buy new car worth Rs. 8,25,000 agreed to exchange his old car with new car. Under GST law, it will be treated as Mr. Y has made supply of old car to dealer Mr. X and Mr. X has made supply of new car to Mr. Y. If Mr. Y is registered person, he will be liable to pay GST on Rs. 1,25,000. Mr. X will be liable to pay GST on Rs. 8,25,000 whether Mr. Y is a registered person or not.

Licence

Meaning

Where one person grants to another, or to a definite number of other persons, a right to do or continue to do in or upon the immovable property of the granter, the right is called a licence.

Example

Mr. X is a developer of information technology software and holder of licence

CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

Page |3 thereon. License to use software was given to different clients and total considerations was Rs. 18 lakhs; hence, Mr. X is liable to pay GST.

Rental

Meaning

Rental means a periodical payment for use of another’s property.

Example

Mr. A owns a large vacant land in prime commercial locality. He gives it on rent of Rs. 1,80,000 per month to a parking contractor, Mr. B who has set up a parking facility on the said land. It is a taxable supply of service and hence, Mr. A is liable to pay GST.

Lease

Meaning

A lease is an agreement whereby the lessor conveys to the lessee, the right to use an asset for an agreed period of time in return for a payment or series of payments. A lease may be financial lease or operating lease.

Example

M/s X Ltd. gives an asset worth Rs. 5,00,000 on lease to M/s Y Ltd. The total payments by Y over the time of lease amount to Rs. 6,50,000. Thus, it’s a finance lease and GST is payable.

Licenses, leases and rentals of goods were earlier treated as services where the goods were transferred without transfer of right to use (effective possession and control over the goods) and were treated as sales where the goods were transferred with transfer of right to use. Under the GST regime, such licenses, leases and rentals of goods with or without transfer of right to use are covered under the supply of service because there is no transfer of title in such supplies. Meaning Disposal Disposal consists of selling the assets when the organization is about to close down. Such transactions will also be considered as supply and liable to tax under GST Law.

Example

Z Ltd. wants to shut down its business owing to depression phase. It is selling various assets at Rs. 60,00,000. GST will be payable.

Insights

Consideration One of the essential conditions for the supply of goods and/ or services to fall within the ambit of GST is that a supply is made for a consideration. However, consideration does not always mean money. It covers anything which might be possibly done, given or made in exchange for something else. Thus, consideration includes non-monetary consideration. Further, a consideration need not always flow from the recipient of the supply. It can also be made by a third person.

Example

Alia Travels Pvt. Ltd., a travel agent books ticket for a customer Mr. Z. Travel agent raises invoice on customer Mr. Z for transportation of passenger by air of Rs. 10,000 and his commission of Rs. 500. The entire amount of Rs. 10,500 is not his consideration. The amount of Rs. 500 retained by the air travel is to be considered as his consideration. A Sports Club agrees to hire services of cricket player Mr. C for a consideration of Rs. 2 crores. In addition to this, the agreement provides that the player shall be provided with the car valued for Rs. 20 lakhs. The entire value of Rs. 2.20 crores will be considered as consideration and subject to tax.

Exclusions The following generally not considered as consideration: • Grant of pocket money • Gift or reward (which has not been given in terms of reciprocity) or • Amount paid on alimony for divorce CA Rahul Garg

B.Com, FCA, LCS, ACMA, CFA (ICFAI), DISA (ICAI), MBA, Adv Dip Mgt.

Gold Medalist

All India Rankholder in CA, CS, CMA (incl Rank 1)

+91-9876932270

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About The Author…

RAHUL GARG is an energetic professional and his distinguished & exceptional teaching style has made thousands of aspiring professionals to conquer their exams successfully. Gold Medalist All India Rankholder in CA, CS, CMA Professional Qualifications * B.Com (GGDSD College, P.U.) * CS (ICSI) * CA (ICAI) * CMA (ICAI) * CFA (ICFAI) * DISA (ICAI) * MBA (Finance) * Adv. Dip. Mgt. (ICFAI)

Awards & Achievements * Covered by the National Magazine 'Career 360' amongst 12 National Toppers in 2010. * Awarded by Mr. Atal Bihari Vajpayee for exceptional performance in academics

Boards & Committees

Professional Journey * AIR 1 (CMA Inter) * AIR 3 (CMA Final) * AIR 4 (CS Inter) * AIR 13 (CS Final) * AIR 41 (CA PE II) * Distinction (CA PE I) * Distinction (B. Com)

* Past Visiting Faculty at ICAI, Chandigarh * Past Visiting Faculty at Chitkara University * Past Joint Director (Coaching),ICAI (Cost) * Past Secretary, ICAI (Cost)

As a Faculty

International Representations * Worked with International Firms & Business Advisors * Grant Thornton * Ernst & Young

* Guiding the students of CA, CS, CMA for past 7 years * Time Management Skills * Stress Management Skills * How to Attempt * 1 Day Capsule

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