KARAIKUDI INSTITUTE OF MANAGEMENT KIT & KIM TECHNICAL CAMPUS

Keeranipatti, Thalakkavur, Karaikudi 630 307 MBA 2013-14 :: I SEMESTER MODEL EXAMINATION BA 7106 - ACCOUNTING FOR MANAGEMENT Time: 3 Hrs Answer ALL questions PART A ( 10 x 2 = 20 Marks ) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. What is GAAP? What are human resources accounting? What are statutory books? What is meant by Employees Stock option scheme? What are the limitations of Ratio scheme? What is fund from operation? What is breakeven point? What is budgetary control? What is codification? Name any two accounting software. Maximum Marks : 100

PART B (5 x 16 = 80 Marks) 11. a) Explain the various accounting concepts and conventions. Or b) Discuss the advantages and disadvantages of inflation accounting. 12. a) Murugan Ltd. was formed on 1-7-96 to acquire the business of Johnson & Sons with effect from 1-1-96. When the companys first accounts were prepared on 31-12-96, the following were noted: a) Sales for the year Rs.3,00,000 b) Sales in January, February, April and May were only 50% of the annual average. Sales of August, September and December were twice the annual average. Calculate the Sales ratio. Or
b) The following is the Trial Balance of Shree Ganesh on 30th June 2007. Name of Account Capital Drawings Stock(1.7.2006) Sundry Creditors Sundry Debtors Machinery Patents Freehold Land Buildings sales Purchases Debit Credit 1, 86,000 15,735 17,280 18,900 43,500 60,000 22,500 30,000 96,000 2,96,340 1,22,025

Sales Returns Purchases Returns Cash at Bank Cash in hand Insurance General Expenses Salaries Wages Factory fuel and power Carriage on Purchases Carriage on Sales Rent

2,040 1,500 7,890 1,620 1,800 9,000 45,000 25,440 14,190 6,120 9,600 27,000 5, 29,740 5, 29,740

The following adjustments are to be effected; Stock on 30th June 2007 Rs.20,400 5% on Sundry Debtors is to be written off as bad. Salaries for the month of June 2007 amounting to Rs.4, 500 were unpaid. Rent Rs. 3000 is accrued but not received. Depreciate Machinery @ 10% and Patents @ 20%. You are required to prepare Trading and Profit and Loss Account and the Balance Sheet as on 30th June 2007.

a) The following are the Financial Statements of Sun Ltd. For the year 2012-13 13. Liabilities 1,00,000 equity shares of Rs. 10 each General Reserve Profit and Loss A/C 6% Debentures Sundry Creditors Proposed Dividends Rs. Balance Sheet ( as on 31-03-2013) Assets Fixed Assets Stocks Sundry Debtors Cash

Rs. 12,50,000 3,50,000 1,80,000 5,15,000

10,00,000 9,00,000 25,000 2,00,000 1,20,000 50,000 22,95,000

22,95,000

Profit and Loss Accounts(for the year ended 31-03-2013) Sales Less : Cost of Goods Sold Gross Profit Expenses Net Profit You are required to compute the following ratio: Current Ratio Acid Test Ratio Gross Profit Ratio Net Income to Capital Debt to Equity Ratio Fixed Asset to Turnover Ratio. 24,00,000 16,00,000 8,00,000 7,00,000 1,00,000

Or b) Given below are the balance sheets of RK Ltd., as on 31-03-2012 and 31-03-2013 Liabilities 2012 (Rs.) 2013 (Rs) Equity Share Capital 2,00,000 3,00,000 Long-Term Loan 1,00,000 1,00,000 Creditors 1,50,000 2,00,000 Bills Payable 2,00,000 3,00,000 Retained Earnings 1,80,000 2,00,000 8,30,000 11,00,000

Assets Cash Stock Debtors Goodwill Plant and Machinery Land and Building Furniture

2012 (Rs) 60,000 1,20,000 80,000 2,00,000 1,00,000 2,00,000 70,000 8,30,000

2013 (Rs) 30,000 1,90,000 1,20,000 1,50,000 2,00,000 4,00,000 10,000 11,00,000

Prepare Schedule of changes in Working Capital Fund flow statement. 14. a) Discuss the various classifications of manufacturing costs. Or b Year Sales ) 2011 1,00,000 2012 Find out P/V Ratio Fixed cost Breakeven Point Sales, to earn a profit of Rs.30,000 15. a) Explain the significance of computerised accounting system. Or b) Discuss the utility of Pre-packaged accounting software in business.
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Profit 20,000 25,000

1,20,000