Semester M.B.A. Degree Examination, Jan./Feb. 2018
(CBCS) (2014-15 and Onwards)
MANAGEMENT
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Paper - 1.3 : Accounting for Managers
SECTION - A
Answer any five of the following questions. Each question carries five marks : (5x5=25)
- What is window dressing? Give examples.
- List and explain in brief the various techniques for cost control and cost reduction.
- List the various users of financial statements and state their informational needs.
- The following details are provide Ltd.
Cost of machine Rs. 78,00,000
Expected useful life 10 years
Consideration expected on disposal Rs. 4,20,000
machinery owned by Shiva Industries--- Content provided by FirstRanker.com ---
Estimated cost of removal of the machine for disposal Rs. 30,000
Estimated realizable value Rs. 3,90,000
a) Determine the rate of depreciation as per Straight Line Method.
b) Determine the annual depreciation and accumulated depreciation for all the years under Straight Line Method.
c) Show the disclosure of machine in the balance sheet for all the years. - The budgeted expenses at 10,000 units of production are:
Per unit (Rs.)
Direct materials 60
Direct labour 30
Variable overheads 20--- Content provided by FirstRanker.com ---
Fixed overheads (Rs. 1,60,000) 16
Variable expenses (Direct) 5
Selling expenses (20% fixed) 15
Administration expenses (Rs. 1,00,000 fixed) 10
Total 156--- Content provided by FirstRanker.com ---
Prepare flexible budget for 7,000 units. - You are given the following data:
Sales price Rs. 350 per unit
Variable cost Rs. 200 per unit
Fixed expenses Rs. 16,50,000--- Content provided by FirstRanker.com ---
Ascertain
a) break-even point
b) selling price per unit if break-even point is brought up to 15,000 units; and
c) selling price per unit if break-even point is brought down to 10,000 units. - Transactions of Omni Cab Company for the year ended on 31st December 2017 include the following:
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Rs.
Borrowed from a bank and purchased land 4,00,000
Sold investment securities 7,00,000
Paid dividends 3,00,000
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SECTION - B
Answer any three questions. Each question carries ten marks : (3×10=30)
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- Explain in detail the various concepts and conventions which influence the preparation of financial statements.
- X Ltd., has manufactured and sold 3 products during 2017 as follows:
Product X - 20000 units
Product Y - 14000 units
Product Z - 10000 units--- Content provided by FirstRanker.com ---
Cost analysis has disclosed as follows:
Per Unit
Fixed cost - Rs. 2,00,000Product X (Rs.) Product Y (Rs.) Product Z (Rs.) Marginal cost 10 18 16 Listed price 20 30 40 Time taken (hours) 2.5 3 2.5
Discount - 10%
Due to shortage of labour, the available hours for the next year are expected to be only 90000 hours.--- Content provided by FirstRanker.com ---
Suggest a suitable product mix for the next year.
a) when there is enough demand for all the three products; and
b) when the potential demand is
i) Product X - 18000 units
ii) Product Y – 10000 units--- Content provided by FirstRanker.com ---
iii) Product Z - 12000 units. - From the following information prepare Cash Flow Statement by Indirect Method (AS-III).
Comparative Balance Sheet Excellent Ltd.
Additional information:Liabilities and Capital As at 31-3-2015 Rs. As at 31-3-2016 Rs. Assets As at 31-3-2015 Rs. As at 31-3-2016 Rs. Share capital 50,00,000 40,00,000 Fixed assets 31,00,000 30,00,000 Reserves 15,00,000 5,00,000 Investments - 1,50,000 Secured loans 35,00,000 40,00,000 Cash balance 2,50,000 1,25,000 Sundry creditors 30,00,000 35,00,000 Inventory 75,00,000 78,75,000 Bills payable 20,00,000 25,00,000 Sundry debtors 30,00,000 28,00,000 Bills receivable 10,00,000 7,00,000 1,50,00,000 1,45,00,000 1,50,00,000 1,45,00,000
i) The net profit for the year after adjustment in respect of provisions for dividends and taxation is Rs. 10,00,000.--- Content provided by FirstRanker.com ---
ii) There was addition to fixed assets during the year amounting to Rs. 4,00,000 and depreciation for the year was Rs. 3,00,000. - A company has furnished the following Ratios and information for the year ended 31st March 2016.
Sales Rs. 60,00,000
Current ratio 2
Share capital to reserves 7:3--- Content provided by FirstRanker.com ---
Return on net worth 25%
Net profit to sales 6.25%
Inventory turnover (based on COGS) 12
Cost of goods sold Rs. 18,00,000
Interest on debentures Rs, 60,000--- Content provided by FirstRanker.com ---
Sundry debtors Rs. 2,00,000
Sundry creditors Rs. 2,00,000
You are required to draw the Balance Sheet as at 31st March 2016 in the following format by supplying the missing figures.
Balance Sheet as at 31st March 2016Liabilities Rs. Assets Rs. Share capital - Fixed assets - Reserve and surplus - Current assets - 15% debentures - Stock - Sundry creditors - Debtors - Cash -
SECTION - C
This is a compulsory question carrying fifteen marks : (1x15=15)
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- Following is the Trial Balance of XYZ Ltd. as on 31st March 2016.
Adjustments:Particulars Debit (Rs.) Credit (Rs.) Equity share capital 30,00,000 12% preference share capital 20,00,000 Reserve fund 15,00,000 Buildings 50,00,000 10% debentures 20,00,000 Plant and machinery 20,00,000 Purchase and sales 25,00,000 60,00,000 Salary 6,00,000 Debtors and creditors 23,00,000 17,50,000 Bills 8,00,000 9,00,000 Directors fees 2,00,000 Bad debts 50,000 Returns 1,50,000 2,00,000 Wages 1,50,000 Opening stock 4,50,000 Profit and Loss Account on 01-04-2015 6,00,000 Loose tools 6,00,000 Goodwill 8,00,000 Discount on issue of shares 2,00,000 Cash and bank balances 3,30,000 12% investments (01-04-2015) 20,00,000 Interest on investments 1,80,000 Total 1,81,30,000 1,81,30,000
1. Closing stock valued at Rs. 14,00,000.
2. Outstanding wages Rs. 25,000.
3. Debenture interest is outstanding for the whole year.--- Content provided by FirstRanker.com ---
4. Write off Rs. 50,000 further bad debts.
5. Buildings and plant and machinery to be depreciated by 5% and 10% respectively.
6. Transfer Rs. 2,50,000 to reserve.
7. The directors propose 15% dividend to equity shareholders.
You are required to prepare Profit and Loss Account and Balance Sheet as on 31st March 2016 in the vertical form as per Part I of Schedule VI of the Companies Act, 1956.
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