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End Term Exam Dec-2014

BBA

Management Accounting

Course Code: BBX 03104

1.

State and explain the differences between cost accounting and


financial accounting.

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or
2.

Limitation of financial accounting have made the management


realize the importance of cost accounting. Comment.

3.

Complete the following Balance Sheet, assuming that only the Equity Share Capital and
Retained Earning figures are given.

12

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Total debt is Two-Third of Net Worth. Turnover of Total Assets is 1.8;


30 days sales are in the form of Debtors; Turnover of inventory is 5; cost of goods sold in
the year is Rs.3,60,000; and the acid test is 1:1.
Or

4.

From the following details available, prepare balance sheet of Dimpy & Co. as on 31 st March,
2006 and compute proprietary funds.
(a) Net worth turnover ratio (on cost of sales) = 2
(b) Fixed assets turnover ratio (on cost of sales) = 4
(c) Gross profits turnover ratio = 20%
(d) Creditors velocity = 73 days
(e) Debtors velocity = 2 months
(f) Stock velocity = 6

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Reserves and surplus amount to Rs. 10,000. Closing stock was Rs. 5,000 in excess of opening
stock. Gross profit was Rs. 60,000.
You can make the necessary assumption, where required.

5.

From the following balance sheets of Beta Limited, make out


(i) Statement of changes in Working capital and
(ii) Funds Flow Statement:

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1. A piece of land has been sold out in the year 2002 and profits on sales have been carried to capital
Reserve.
2. A machine has been sold for Rs.10,000. The written down value of the machine was Rs.12,000.
Depreciation of Rs.10,000 is charged on plant account in the year 2002.
3. The investments are trade investments. Rs. 3,000 by way of dividend is received including Rs.1,000
from pre-acquisition of profit, which had been credited to investments account.
4. An interim dividend of Rs.20,000 has been paid in the year 2002.

Or

6.

Following information is available from the books of Suresh Ltd. for the year-end 31-12-2005
and 31-12-2006.

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Calculate cash flow from operations for the year ending 31-12-2006.

7.

Explain the needs of working capital. Critically explain the factors affecting
the requirement of working capital.

12

or
8.

From the following information extracted from the books of a manufacturing


company,
compute the operating cycle in days and the amount of working capital
required:
Period Covered
Average period of credit allowed by suppliers
Average Total of Debtors Outstanding
Raw Material Consumption
Total Production Cost
Total Cost of Sales
Sales for the year
Value of Average Stock maintained:
Raw Material
Work-in-progress
Finished Goods

9.

365 days
16 days
480 00
400 00
10,000 00
10,500 00
16,000 00

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320 00
350 00
260 00

Explain the technique of Marginal costing and state its importance in decision-making?
Narrate the circumstances when the firm would fix the selling price below its marginal
cost?

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or

10
.

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Quality products Ltd. manufactures and markets a single product. The following data is
available.
Rs. per unit
Materials
16
Conversion Cost
12
Dealer Margin
4
Selling Price
40
Fixed Cost
Rs. 5 lakh
Present Sales
90,000 units
Capacity Utilization 60%
There is over competition in the market. Firm has realized concerted efforts are necessary to
increase sales. The following suggestions have been made for increasing sales.

(a) By reducing the sale price by 5%.


(b) By increasing the dealers margin by 25% over the existing rates.
Which of these suggestions would you recommend?

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