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Roll No. :-.k.LB (J <rl ( 0 4 A'~ S-; (M-105)

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IIM610s1

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M.B.A.(Sem. i)(Main/Back)Examination, February - 2009

, ,

Management Accounting,. I
[Total Marks: 70 [Min. Passing Marks: 28

Time: 3 Hours]

The question Paper is divided in two. Sections. Section A contains' 6 questions out of which the candidate is . required to attempt any 4 questions. Section B contains short case study / application based one question whichis compulsory. All questions are' carrying equal marks.
Use of followingsupporting material is permitted during examination. (Mentioned in form No.205)'

1.

Nil

2.

Nil
"

SECTION - A
1

(a)

"The structure of Management accounting is cr~ated by adopting concepts and techniques from a number of disciplines." Explain.
7 Explain Money measurement, separate cOJ!cept. of ~inancial Accounting.. . , entity and matching '
7

(b)

2
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(a)
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What ~re 1;Jie guiding principles

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of Corporate
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Governance?
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. , ,,(&}p~~Fb:nowing balances have been extracted from the books Of Shri Gagan Shivarii on 31st March, 2go8 r('Openin~tock Rs. 15,000, Pur&aseS' Rs. 50,000, S~Rs. 80,000, Return ~d Rs., 300, Return;.6iit ward Rs. 2,000, Debtors Rs. '40,500, Fixed deposit in Bank
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Prepare Final Account for the year, ending 31st March 2008 after taking in to consideration of following

adjustments:
,

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(1) ,Cl~~ing stock on 31st March 2008 Rs. 28,400

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(2) Interest accrued on fixed deposits in Bank for 3 months, commission received in adv" Rs. 400.
, '

(3) Further, Bad-debts Rs. 500 and maintain provision for bad-debts at 5% on deburrs. ----

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Depreciate Building by 5%.

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(5) Goods'worth Rs. 300 were donaJed for whi~h no entry was made in the books (6)' Provide ,for M,~nag~~_'~~~o~~ission 5% on net profit 'after charging this comniission.,

----

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(a) From the Balance sheets an,.d,~nformation given belo~ prepare 'a statement of souJ,'ces' and uses' for the yea
2008:
Liabilities
,

'

2007 Rs. 40,000 25,000 40,000

1,25,000

2008 Assets Rs. 44,000 Cash ./ Debtors -../ 50,000 ' Stock ../
1,53,000
(

2007
"

Rs.:
10,000 30,000
35)000 80;000 35,000 '

2008 1
Rs. 7,000 50,000
25,000 55,000 60,000 50,000 ,2,47,000

Creditor
, \.\ ;\-:":~~

Loan from-A
Loan from Bank
Capital

Machinery Building Land

40,000
2,30,000

2,30,000
. '

2,47,000

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Durin!

.the "year
,

2008 a Machine, costing Rs.-.1QJill.Q.

(~ccumu~te-

depreciation

Its. ~,OQJlJl 'was

sold' fo;

Rs. ~_
and
,

31st

_.e provision for ~epre~atiQll on Jan. 20.08 De 2008, were Rs. 25,000 and Rs. 40,000 .
,

respectively. Ne't profit for the year 2008 was amounted

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to Rs. 45,000.
(b)
.

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Write notes on :
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10

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(a)
,

~tdevelopm<!nts in management
Comparative financial statement.
,

accounting 4

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Following informations
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are obtained from the books of Varun

Textiles Limited and you are required to ascertain--cash from operation there from for th~ear 2007-08 :
-"',
31-3-2007 Rs.
"

.
Profit and Loss accounts

31-3-2008 Rs.

3,20,000 80,000 1,07,000 '

4,80,000

Sundry Sundry Prepaid

crditors debtors expenses

84,000
1,31,400 3,900 3,300 1,15,000 5,60,000

4,800

Accrued Interest Provision for depreciation (at cost)

-

3,600
90,000

Fixed assets

4,50,000

Income. tax -payable

1

26,000

19,000

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Additional information for the year' 2007-08 :

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Interest'6n , . '.
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debenture

paid anq.-debited ' "

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to profit

and

c~\ ~,loss' account for the year was Rs. 36,000 and interest
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received and credited !o profit' and loss account ,was

Rs. 7,800.

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(ii) A machine costing Rs. l~,OOO (ac<:,mulated depreciatio" Rs. 11,000) was so14 for Rs. 13,500.
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Rs. 76,ObQ

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no.

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(iv) Interim !i~d

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paid ~s. 16,000 an~e

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tax paid
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(b)

Write short (i) (ii)

notes on : costs and uncontrollable cost and sunk cost. 6 costs

Controllable Opportunity

(a)
/

In a factory three products are produced using same inputs. The particulars related. to these products are as
under.
. .

Particulars X

Product Y
:

Z Rs. 100

Rs. Per unit selling price

.

Rs. 200

250

Per unit variable per kg.

cost
.

material @ Rs. 20

60

50

40

Skilled labour @ Rs. 10 per hour' Variable overhead @ Rs. 5 40 30

, .

15

per machine hour

.

10

Fixed cost Rs. 16,000~ State Which product is better to be produced and sold' if: '

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(a)
(b)

There are normal business conditions

There is restricted 4 demand of products

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(c) (d) (e) (f)

There is restricted

on total sales in amount.

There is short~ge of material: : There is shortage 6f skilled l~bour

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hours h~urs.
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There is limited

availability

of machine

10

(b) ~~l~:

dlffere.nt stages of activity based costing. 4

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6

(a) "Budgetary control helps in business progress." Critically examine this statement. 4
(b) Calculate: (i) (ii) Activity ratio Capacity ratio

(iii) EfficieI.1cy ratio and (iv) Calender ratio from the following information.
-

. Budget for
July 2008

Actual for' July 2008 27.

No. of working days', Output (in units)

25. 600 3

.Hours per unit o~ output

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,A "toy manufacture
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currently selling at

earns Rs.
.

an
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average toy,

profit producing ...-

of
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Rs.3

6000 toys. Compl$tation of current cost of sales, per toy is as u~der :

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toy by

15 per

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Direct material

Rs. 4, Direct wages Re. 1, Work overhead 6, and selling overhead (25% varin g)

(50% fixed) Rs. Re. 1.

During the coming year following increases (i) Fixed cost will go up by 10%

are anticipated:

(ii) Rates (iii) Rates

of direct labour will increase by ~O% of direct material will incre~se by 10%

(iv) Selling price cannot be increased if sales in units will be maintained

Under
........

at current level of sales.

he obtains an unexpected

the circumstances

order for 2000 toys. What :Minimum price will you recommend for acceptIng the order to ensure the overall profits of

'Rs. 18,050 to the toy manufacture. 6

SECTION - B
7 From the information given bel?w prepare estimate of working capital requirement at the end of the year 2008 :
Rs. 9,00,000

Budgeted sales for the year 2008

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Estimated cash sales and credit sales ratio Debtors velocity .

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1:4
2 months

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Estim~~~d/gross
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20% of sales
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Oper,ating

ratio.

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90% 8

Stock velocit y ... ... IM6105}

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Proprietary funds to fixed assets

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0.80

Time lag in payment Liquidity ratio.

of operatjng

expenses

! month :.. 1.8

Net profit on proprietory fun as

Closing stock level is expected opening stock.

"15% by 40% over

to increase

14

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