Visvesvaraya Technological University (VTU) 2010 M.C.A Accounting and Finanical Management - exam paper

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Important Note : 1. On completing your answers, compulsorily draw diagonal cross lines on the remaining blank pages.

b. From the following trial balance of Akash, prepare trading and profit & loss account and Balance sheet as on 31^st March 2009.

Trial Balance as on 31-03-2009

S.No.	Particulars	Debit (Rs)	Credit (Rs)
1	Akashs capital	-	3,50,000
2	Akashs drawings	8,000	-
3	Purchases and sales	1,00,000	1,36,000
4	Returns	7,000	5,000
5	Wages	14,000	-
6	Fuel and power	1,800	-
7	Carriage outwards	1,900	.
8	Carriage inwards	1,000	.
9	Discount received	-	16,000
10	Commission allowed	1,100	_
11	Bad debts	1,300	_
12	Salaries	14,500	.
13	Sundry debtors and sundry creditors	23,000	18,000
14	Bank over-draft		5,000
15	Bills payable & bill receivable	12,000	6,000
16	Rent & taxes	1,700	-
17	Insurance	1,400	_
18	Postage	200	-
19	Land & Buildings	3,25,000	-
20	Plant & machinery	13,000	- -
21	Furniture	3,000	_
22	Stock as on 1-4-2008	5,600
23	Cash in hand	500	-
		5,36,000	5,36,000

Adjustments :

i)    Closing stock Rs. 15,000.

ii)    Outstanding expenses: Wages Rs.500; Salaries Rs. 700.

iii)    Prepaid expenses: Rent Rs.200; Insurance Rs.100.

iv)    Write off further bad-debts Rs.500.

v)    Create 3% reserve for discount on creditors.

vi)    Provide 4% reserve for bad-debts and 5% reserve for discount on debtors.

vii)    Allow interest on drawings @ 5% p.a. and interest on capital Rs.700.

viii)    Depreciate plant and machinery @ 6% furniture @ 8%.    {is Marks)

2 a. Distinguish between cost accounting and financial accounting.    (05 Marks)

b. A company manufactured and sold 100 computers. Following are the particulars for the year 2008.

Materials Rs. 3,20,000 Wages Rs. 4,80,000 Factory overheads Rs. 2,00,000 Office overheads Rs. 3,60,000 Selling & distribution overheads Rs. 1,20,000 Sales Rs. 16,00,000

Estimations for the year 2009 are:

i) Production and sales 300 computers ii) Material cost will increase by 20% iii) Wages will increase by 5%. iv) Factory overhead will increase in proportion to the combined cost of materials and wages. v) Selling & distribution costs per unit will remain the same. vi) Office expenses will not be affected. Prepare an estimated cost sheet for the year 2009, showing a profit of 10% on sales.

(15 Marks)

3 a. Define marginal costing. Briefly explain the advantages of marginal costing. (05 Marks) b. The following data is supplied:

Fixed cost    Rs. 6000

Variable cost    Rs. 200 per ton

Selling price    Rs. 600 per ton

The units produced and sold are 30 tons. Draw a break even chart and calculate

i)    P/V ratio

ii)    Break even point

iii)    Margin of safety.    (15 Marks)

a.    Distinguish between cash flow and fund flow analysis.    (05 Marks)

b.    From the following balance sheets of X Ltd., on 31^st December 2007 and 2008, you are

Liabilities 2007 Rs. 2008 Rs. Assets 2007 Rs. 2008 Rs. Share capital 1,00,000 1,00,000 Goodwill 2,000 2,000 General reserve 14,000 18,000 Building 40,000 36,000 Profit & loss A/c 6,000 3,000 Plant 37,000 36,000 Sundry creditors 8,000 5,400 Investments 10,000 11,000 Bills payable 1,200 800 Stock 30,000 23,400 Provision for taxation 16,000 18,000 Bills receivable 2,000 3,200 Provision for doubtful debts 4,000 600 Debtors 18,000 19,000 Cash/bank 6,600 15,200 1,45,600 1,45,800 1,45,600 1,45,800 The following additional in: rormation las also been given:

i)    Depreciation charged on plant was Rs.4000 and on building Rs.4000. ii)    Provision for taxation of Rs,19000 was made during the year 2008. iii)    Interim dividend of Rs.8000 was paid during the year 2008. (t5 Marks)

5 a. What do you mean by ratio analysis? Mention the various classifications of ratios. (05 Marks)

MEGHA factory, engaged in an industry, which is capital intensive, has been in operation for five years. The capital employed is Rs. 170 lakhs, out of which Rs.100 lakhs represents equity capital and reserves, Rs. 50 lakhs long term borrowings on debentures and Rs.20 lakhscash credit from banks. The working capital of the company Rs. 85 lakhs is made up of stocks Rs.30 lakhs; stores Rs. 14 lakhs; debtors Rs.35 lakhs and advances and deposits Rs.6 lakhs. Annual sales is Rs.80 lakhs.

Calculate the following ratios for use of the management:

i) Current ratio    ii) Liquidity ratio    iii) Debt-Equity ratio

iv) Proprietary ratio v) Fixed assets ratio.    (IS Marks)

What do you mean by networking capital? Briefly explain the different determinants of working capital.    (05 Marks)

You are supplied with the following information in respect of Geeta Ltd., for the ensuing year:

Production for the year Finished goods on stores Raw material in store Production process Credit allowed by creditors Credit given by debtors Selling price per unit Raw material Direct wages Overheads

There is regular production and sales cycle and wages and overheads occur evenly. Wages are paid in the next month of accrual. Material is introduced in the beginning of production cycle. Find the required working capital.    (15 Marks)

7 a. Define C.V.P. analysis. Briefly discuss the various utilities of C.V.P. analysis. (05 Marks)

b. Draw a flexible budget for overhead expenses on the basis of the following data. Determine the overhead rates @ 70%, 80% iand 90% plant capacity.

Variable overheads    @ 80% capacity (Rs)

Indirect labour    12,000

Stores including spares    4,000 Semi-variable overheads

Power (30% fixed, 70% variable)    20,000

Repairs and maintainance (60% fixed, 40% variable)    2,000 Fixed overheads

Depreciation    11,000

Insurance    3,000

Salaries    _10,000

Total overheads    62,000_

Estimated direct labour hours    124000 hrs

(15 Marks)

Write short notes on the following:

a.    Nature of investment decisions in capital budgeting

b.    Objectives of budgetary control

c.    Principles of double entry system of book keeping

d.    Estimating working capital needs.

*****

3 of 3

(20 Marks)

Attachment: visvesvaraya-technological-university--vtu--2010-m-c-a--42086-1.pdf

Earning:   Approval pending.