Summer/May 2012
Master of Business Administration - MBA Semester 1
Subject Code – MB0041
Subject Name – Financial and Management Accounting
4 Credits
(Book ID: B1130)
Assignment Set- 1 (60 Marks)
Note: Each question carries 10 Marks. Answer all the questions.
Q1. Assure you have just started a Mobile store. You sell mobile sets and currencies of Airtel, Vodaphone, Reliance and BSNL. Take five transactions and prepare a position statement after every transaction. Did you firm earn profit or incurred loss at the end? Make a small comment on your financial position at the end.
Q2. (a) List the accounting standards issued by ICAI.
(b) Write short notes of IFRS.
Q3. Prepare a Three-column Cash Book of M/s Thuglak & Co. from
The following particulars:
20X1 Jan
1. Cash in hand Rs. 50,000, Bank Overdraft Rs. 20,000
2. Paid into bank Rs. 10,000
3. Bought goods from Hari for Rs, 200 for each
4. Bought goods for Rs. 2,000 paid cheque for them, discount allowed 1%
5. Sold goods to Mohan for each Rs. 1.175
6. Received a cheque from Shyam to whom goods were sold for Rs. 800.Discount allowed 12.5%
7. Shyam’s cheque deposited into bank
8. Purchased an old typewriter for Rs. 200 , Spent Rs. 50 on its repairs
9. Bank notified that Shyam’s cheque has been returned dishonored and debited the account in respect of charges Rs. 10
10. Received a money order Rs. 25 from Hari
11. Shyam settled his account by means of a cheque for Rs. 820, Rs. 20 being for interest charged.
12. Withdrew from the bank Rs. 10,000
18. Discounted a B/E for Rs. 1,000 at 1% through bank
20. Honored our own acceptance by cheque Rs. 5,000
Summer/May 2012
22. Withdrew fir personal use Rs. 1,000
24. Paid tread expenses Rs. 2,000
25. Withdrew from bank for private expenses Rs. 1,500
26. Purchased machinery from Rajiv for 5,000 and paid him by means of a bank draft purchased for Rs. 5,005
27. Issued cheque to Ram Saran for cash purchased of furniture Rs. 1,575
28. Received a cheque for commission Rs. 500 from R.& Co. and deposited into bank
29. Ramesh who owned us Rs. 500 became bankrupt and paid us 50 paise in the rupee
30. Received payment of a loan of Rs. 5,000 and deposited Rs. 3,000 out of into bank
31. Paid rent to landlord “Mohan” by cheque of Rs. 220
31. Interest allowed by bank Rs. 30
31. Half-yearly bank charges Rs. 50
Q4. Choose an Indian Company of your choice that has adopted Balance Score Card and detail on it.
Q5. From the following data of Jagdish Company prepare (a) a statement of source and uses of working capital (funds) (b) a schedule of changes in working capital
Assets
2008
2007
Cash
1,26,000
1,14,000
Short-term investment
42,400
20,000
Debtors
60,000
50,000
Stock
38,000
28,000
Long term Investment
28,000
44,000
Machinery
2,00,000
1,40,000
Building
2,40,000
80,000
Land
14,000
14,000
Total
7,48,400
4,90,000
Liabilities and Equity
Accumulated depreciation
1,10,000
60,000
Creditors
40,000
30,000
Bills Payable
20,000
10,000
Secured loans
2,00,000
1,00,000
Share capital
2,20,000
1,60,000
Share premium
24,000
Nil
Reserves and surplus
1,34,400
1,30,000
Total
7,48,400
4,90,000
Summer/May 2012
Income statement
Sales
2,40,000
Cost of goods sold
1,34,600
Gross Profit
1,05,200
Less Operating expenses:
Depreciation – machinery 20,000
Depreciation – building 32,000
Other expenses 40,000
92,000
Net profit from operation
13,200
Gain on sale on long-term investment
4,800
Total
18,000
Loss on sale of machinery
2,000
Net Profit
16,000
Adjustments:
1) Machinery worth Rs.70000 was purchased and worth Rs.10000 was sold during the year [Accumulated depreciation on machinery is Rs.18000 after adjusting depreciation on machinery sold]. Proceeds from the sale of machinery were Rs.6000
2) Dividends paid during the year Rs.11600
Q6. What is a cash budget? How it is useful in managerial decision making?
Summer/May 2012
Master of Business Administration - MBA Semester 1
Subject Code – MB0041
Subject Name – Financial and Management Accounting
4 Credits
(Book ID: B1130)
Assignment Set- 2 (60 Marks)
Note: Each question carries 10 Marks. Answer all the questions.
Q1. Selected financial information about Vijay merchant company is given below:
2010
2009
Sales
69,000
43,000
Cost of Goods Sold
57,000
32,500
Debtors
7,200
3,000
Inventories
11,400
5,500
Cash
1,500
800
Other current assets
4,000
2,700
Current liabilities
16,000
11,000
Compute the current ratio, quick ratio, average debt collection period and inventory turnover for 2009 and 2010. State whether there is a favorable or unfavorable change in liquidity from 2009 to 2010. At the beginning of 2009, the company had debtors of Rs.2500 and inventory of Rs.3000.
Q2. Explain different methods of costing. Your answer should be studded with examples (preferably firm name and product) for each method of costing.
Q3. State the importance of differentiating between the fixed costs and variable costs in managerial decision.
Summer/May 2012
Q4. Following are the extracts from the trial balance of a firm as at 31st March 2009
Name of the account
Dr
Cr
Sundry debtors
2,05,000
Bad debts
3,000
Additional Information
1) After preparing the trial balance, it is learnt that Mr.X a debtor has become insolvent and nothing could be recovered from him and, therefore the entire amount of Rs.5,000 due from him was irrecoverable.
2) Create 10% provision for doubtful debt.
Required: Pass the necessary journal entries and show the sundry debtors account, bad debts account, provision for doubtful debts account, P&L a/c and Balance sheet as at 31st March 2009.
Q5. A change in credit policy has caused an increase in sales, an increase in discounts taken, a decrease in the amount of bad debts, and a decrease in investment in accounts receivable. Based upon this information, the company’s (select the best one and give reason)
1) Average collection period has decreased
2) Percentage discount offered has decreased
3) Accounts receivable turnover has decreased
4) Working Capital has increased.
Q6. Identify the users of accounting information.
Master of Business Administration - MBA Semester 1
Subject Code – MB0041
Subject Name – Financial and Management Accounting
4 Credits
(Book ID: B1130)
Assignment Set- 1 (60 Marks)
Note: Each question carries 10 Marks. Answer all the questions.
Q1. Assure you have just started a Mobile store. You sell mobile sets and currencies of Airtel, Vodaphone, Reliance and BSNL. Take five transactions and prepare a position statement after every transaction. Did you firm earn profit or incurred loss at the end? Make a small comment on your financial position at the end.
Q2. (a) List the accounting standards issued by ICAI.
(b) Write short notes of IFRS.
Q3. Prepare a Three-column Cash Book of M/s Thuglak & Co. from
The following particulars:
20X1 Jan
1. Cash in hand Rs. 50,000, Bank Overdraft Rs. 20,000
2. Paid into bank Rs. 10,000
3. Bought goods from Hari for Rs, 200 for each
4. Bought goods for Rs. 2,000 paid cheque for them, discount allowed 1%
5. Sold goods to Mohan for each Rs. 1.175
6. Received a cheque from Shyam to whom goods were sold for Rs. 800.Discount allowed 12.5%
7. Shyam’s cheque deposited into bank
8. Purchased an old typewriter for Rs. 200 , Spent Rs. 50 on its repairs
9. Bank notified that Shyam’s cheque has been returned dishonored and debited the account in respect of charges Rs. 10
10. Received a money order Rs. 25 from Hari
11. Shyam settled his account by means of a cheque for Rs. 820, Rs. 20 being for interest charged.
12. Withdrew from the bank Rs. 10,000
18. Discounted a B/E for Rs. 1,000 at 1% through bank
20. Honored our own acceptance by cheque Rs. 5,000
Summer/May 2012
22. Withdrew fir personal use Rs. 1,000
24. Paid tread expenses Rs. 2,000
25. Withdrew from bank for private expenses Rs. 1,500
26. Purchased machinery from Rajiv for 5,000 and paid him by means of a bank draft purchased for Rs. 5,005
27. Issued cheque to Ram Saran for cash purchased of furniture Rs. 1,575
28. Received a cheque for commission Rs. 500 from R.& Co. and deposited into bank
29. Ramesh who owned us Rs. 500 became bankrupt and paid us 50 paise in the rupee
30. Received payment of a loan of Rs. 5,000 and deposited Rs. 3,000 out of into bank
31. Paid rent to landlord “Mohan” by cheque of Rs. 220
31. Interest allowed by bank Rs. 30
31. Half-yearly bank charges Rs. 50
Q4. Choose an Indian Company of your choice that has adopted Balance Score Card and detail on it.
Q5. From the following data of Jagdish Company prepare (a) a statement of source and uses of working capital (funds) (b) a schedule of changes in working capital
Assets
2008
2007
Cash
1,26,000
1,14,000
Short-term investment
42,400
20,000
Debtors
60,000
50,000
Stock
38,000
28,000
Long term Investment
28,000
44,000
Machinery
2,00,000
1,40,000
Building
2,40,000
80,000
Land
14,000
14,000
Total
7,48,400
4,90,000
Liabilities and Equity
Accumulated depreciation
1,10,000
60,000
Creditors
40,000
30,000
Bills Payable
20,000
10,000
Secured loans
2,00,000
1,00,000
Share capital
2,20,000
1,60,000
Share premium
24,000
Nil
Reserves and surplus
1,34,400
1,30,000
Total
7,48,400
4,90,000
Summer/May 2012
Income statement
Sales
2,40,000
Cost of goods sold
1,34,600
Gross Profit
1,05,200
Less Operating expenses:
Depreciation – machinery 20,000
Depreciation – building 32,000
Other expenses 40,000
92,000
Net profit from operation
13,200
Gain on sale on long-term investment
4,800
Total
18,000
Loss on sale of machinery
2,000
Net Profit
16,000
Adjustments:
1) Machinery worth Rs.70000 was purchased and worth Rs.10000 was sold during the year [Accumulated depreciation on machinery is Rs.18000 after adjusting depreciation on machinery sold]. Proceeds from the sale of machinery were Rs.6000
2) Dividends paid during the year Rs.11600
Q6. What is a cash budget? How it is useful in managerial decision making?
Summer/May 2012
Master of Business Administration - MBA Semester 1
Subject Code – MB0041
Subject Name – Financial and Management Accounting
4 Credits
(Book ID: B1130)
Assignment Set- 2 (60 Marks)
Note: Each question carries 10 Marks. Answer all the questions.
Q1. Selected financial information about Vijay merchant company is given below:
2010
2009
Sales
69,000
43,000
Cost of Goods Sold
57,000
32,500
Debtors
7,200
3,000
Inventories
11,400
5,500
Cash
1,500
800
Other current assets
4,000
2,700
Current liabilities
16,000
11,000
Compute the current ratio, quick ratio, average debt collection period and inventory turnover for 2009 and 2010. State whether there is a favorable or unfavorable change in liquidity from 2009 to 2010. At the beginning of 2009, the company had debtors of Rs.2500 and inventory of Rs.3000.
Q2. Explain different methods of costing. Your answer should be studded with examples (preferably firm name and product) for each method of costing.
Q3. State the importance of differentiating between the fixed costs and variable costs in managerial decision.
Summer/May 2012
Q4. Following are the extracts from the trial balance of a firm as at 31st March 2009
Name of the account
Dr
Cr
Sundry debtors
2,05,000
Bad debts
3,000
Additional Information
1) After preparing the trial balance, it is learnt that Mr.X a debtor has become insolvent and nothing could be recovered from him and, therefore the entire amount of Rs.5,000 due from him was irrecoverable.
2) Create 10% provision for doubtful debt.
Required: Pass the necessary journal entries and show the sundry debtors account, bad debts account, provision for doubtful debts account, P&L a/c and Balance sheet as at 31st March 2009.
Q5. A change in credit policy has caused an increase in sales, an increase in discounts taken, a decrease in the amount of bad debts, and a decrease in investment in accounts receivable. Based upon this information, the company’s (select the best one and give reason)
1) Average collection period has decreased
2) Percentage discount offered has decreased
3) Accounts receivable turnover has decreased
4) Working Capital has increased.
Q6. Identify the users of accounting information.