Madurai Kamraj University (MKU) 2007 B.B.A Financial accounting and cost accounting - Question Paper
Financial accounting and cost accounting
MAY 2007
K.o pages;
1210/BA4
FINANCIAL ACCOUNTING AND COST ACCOUNTING
(For those who joined in July 2003 and after)
Time : Three hours Maximum : 100 marks
Answer any FIVE questions choosing not more than THREE questions from each Part.
All questions carry equal marks.
PART A
1. (a) Explain the need of Accounting in Modern Business.
(b) Distinguish between Journal and Ledger.
2. (a) What are the main points of distinction between income and expenditure account and receipts and payments account?
(b) Explain the duties of an internal auditor.
3. Correct the following errors found in the books of Mr. Ravi. The Trial Balance was out by Rs. 986 excess credit. The difference has been posted to a suspense account.
(a) A sale of Rs. 400 to X and Co., was wrongly credited to their account.
(b) A purchase of Rs. 134 had been posted to the creditor's account as to Rs. 120
(c) The total of returns inward book for December had been cast Rs. 200 short.
(d) A cheque for Rs. 400 received from Suriya had been dishonoured and was posted to the debit of Allowance Account.
4. On 31st March 2005, the following trial balance was extracted from the books of Chandru :
Dr.
Rs.
Cr.
Rs.
50,000
80,000
60,000
1,000
30,000
1,77,000
750
350
800
75
45,000
25,000
Capital
Plant & machinery
Purchases and sales
Returns
Opening stock
Discounts
Bank charges
Debtors and Creditors
Dr. Cr.
Rs. Rs.
Manufacturing wages 10,000
Carriage inwards 750
Carriage outwards 1,200
Bad debts provisions - 525
Rent 10,000
Advertisement 2,000
Cash in hand 900
Cash at bank 6,000
2,54,075 2,54,075
You are asked to prepare the final accounts. For the year ended 31st March 2005 and the Balance Sheet as on that date. The following1 adjustments are required :
(a) Closing stock Rs. 35,000
(b) Depreciation of plant @ 6%
(c) Bad debts provisions to be adjusted to Rs. 500
(d) Interest on capital to be allowed at 10% p.a.
(e) 2.5% of profit is to be carried to Reserve
fund.
5. From the following prepare Income and Expenditure account for the year ended on 31st March 2002
.4.2001 |
Rs. |
2002 March 31 |
Rs. |
o Balance |
By Salaries |
3,60,000 | |
Cash at bank |
45,500 |
" Rent |
60,000 |
Cash on hand |
5,500 |
" Printing |
14,500 |
Mar. 2002 |
" Postage |
2,500 | |
Subscription |
" Old motor bike | ||
(including Rs. 20,000 |
purchased |
9,500 | |
for 2002-03) |
3,00,000 | ||
Interest on |
" Plan Bonds |
68,000 | |
investments |
' | ||
(Cost of Investments | |||
Rs. 3,00,000) |
1,50,000 |
" Balance | |
Bank Interest |
1,000 |
Cash |
1,200 |
Sale of Scooter |
25,000 |
Cash at bank |
11,300 |
5,27,000 |
5,27,000 |
Subscription include Rs. 12,000 for 2001-02. Also rent includes Rs. 5,000 paid for March 2001. Subscriptions amounted to Rs. 15,000 have still to be collected for the year 2001-02. Rent for March 2002 had still to be paid and Rs. 2,500 is outstanding against a stationery bill. The book value of the scooter was Rs. 20,000.
6. (a) Define costing and cost accounting. Explain the importance of cost accounting.
(b) Explain the various stock levels of materials.
7. (a) Bring. out the managerial application of Break-Even Analysis.
(b) Define standard costing. How standards are
fixed.
8. The following expenses were incurred for a product during the year ended on 31st December 2005 :
Rs.
Direct materials 30,000
Direct wages 40,000
Chargeable expenses 10,000
Factory overheads 20,000
Selling and distribution overhead 20,000 Administrative overhead 30,000
Profit on sales is 25%.
Prepare cost sheet and ascertain the value of
sales.
9. XY Ltd. are manufactures of three products A , B and C . The actual joint expenses of manufacture for a period were Rs. 60,000. It was estimated that the profit of each product as a percentage of sales would be 30%, 25% and 15% respectively.
A |
B |
C | |
Rs. |
Rs. |
Rs. | |
Material |
1,000 |
750 |
250 |
Direct wages |
2,000 |
1,250 |
500 |
Overheads |
1,500 |
2,250 |
750 |
4,500 |
4,250 |
1,500 | |
Sales were |
60,000 |
40,000 |
25,000 |
Prepare a statement showing the apportionment of the joint expenses of manufacture ove'r the different products.
10. Construct a flexible budget for production at 80% and 100% capacity:
Product at 60% capacity - 6000 units
Material Re. 0.50 per unit
Labour Rs. 0.40 per unit
Overhead Rs. 0.40 per unit
Factory overhead cost Rs. 5,000 (40% fixed)
Administrative expenses Rs. 3,000 (60% fixed).
6 1210/BA4
Attachment: |
Earning: Approval pending. |