Bharathiar University 2008 B.Com Management Accounting - exam paper

(iv) Current ratio - 2.5
(v) Liquid ratio - 1.5
(vi) Fixed assets to proprietor’s fund 0:75
(vii) Long term liabilities – Nil

18. (a). The summarized Balance sheets of ABC Ltd. As 31st December 2001 and 2002 are provided below:
Liabilities 2001 2002 Assets 2001 2002
Share capital 2,25,000 2,25,000 Assets 2,00,000 1,60,000
Reserve 1,50,000 1,55,000 Investments 25,000 30,000
Profit & Loss A/ c 28,000 34,000 Stock 1,20,000 1,05,000
Creditors 84,000 67,000 Debtors 1,05,000 2,27,000
Provision for taxation 37,500 5,000 Bank 74,500 98,500
Mortgage loan - 1,35,000
5,24,500 6,21,000 5,24,500 6,21,000
Additional information:
i) Investments costing Rs. 4,000 were sold during the year 2002 for Rs 4250.
ii) Provision for taxation made during the year Rs 4,500.
iii) During the year part of the fixed assets costing Rs. 5,000 were sold for Rs. 6,000.
iv) Dividend paid during the years Rs. 20,000.
Prepare fund flow statement.
(or)
(b). The Balance Sheets of X Ltd. As on 1-1-99 and 31 – 12 – 99 are provided below:
Liabilities 1/1/99 31/12/99 Assets 1/1/99 31/12/99
Share capital 1,25,000 1,53,000 Cash 10,000 47,000
Bank loan 40,000 50,000 Debtors 30,000 50,000
Loan from Financial Institutions Stock 35,000 25,000
25,000 - Machinery 80,000 55,000
Creditors 40,000 44,000 Land 40,000 50,000
Profit and loss A/c 1,00,000 1,20,000 Buildings 35,000 60,000
Goodwill 1,00,000 80,000
3,30,000 3,67,000 3,30,000 3,67,000
Other information:
i) Dividend paid Rs. 15,000 during the year.
ii) Rs. 20,000 worth of machinery was sold at book value.
Prepare Cash Flow Statement

19. (a) From the subsequent info relating to Kevin Ltd. you are needed to obtain out
(i). Profit quantity ratio, (ii) Break Even Point, (iii) Profit (iv).Margin of safety
(v) Also compute the quantity of sales to earn profit Rs. 6,000.
Total Fixed costs Rs. 4,500. Total variable cost Rs. 7,500. Total sales Rs. 15,000
(or)

(b). The sales turnover and profit during the 2 years were as follows:
Year Sales (Rs.) Profit (Rs.)
1998 1,40,000 15,000
1999 1,60,000 20,000






compute : i) P/V ratio
ii).Break Even Point
iii) Sales needed to earn a profit of Rs. 40,000
iv) fixed expenses and
v) profit when sales Rs. 1,20,000.

20. (a). The Income and expenditure forecasts for months of March to August 2000 are as follows:
Months Sales (credit) Rs. Purchase (Credit) Rs. Wages (Rs.) Manufacturing expenses (Rs.) Admin. Expenses (Rs.) Selling expenses (Rs.)
March 60000 36000 9000 3500 2000 4000
April 62000 38000 8000 3750 1500 5000
May 64000 33000 10000 4000 2500 4500
June 58000 35000 8500 3750 2000 3500
July 56000 39000 9500 5000 1000 3500
August 60000 34000 8000 5200 1500 4500
You are provided the subsequent further information:
i) Creditors allow two months credit and debtors are paying 1 month late.
ii) Opening balance of cash Rs. 8,000.
iii) Lag of 1 month in expenses.
Prepare cash budget for the period may to August.

(b). The subsequent info relates to a flexible budget at 60 % capacity. obtain out the overhead costs at 50 % and 70 % capacity and also determine the overhead rates:

Expenses at 60% capacity.
Variable overheads: Rs.
Indirect Labour 10,500
Indirect materials 8,400
Semi Variable Overheads:
Repairs and Maintenance ( 70% Fixed) 7,000
Electricity (50% fixed, 50% Variable) 25,200
Fixed Over heads:
Office expenses including salaries 70,000
Insurance 4,000
Depreciation 20,000
Estimated direct labour hours 1, 20,000.

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Earning:   Approval pending.