DISTANCE EDUCATION
M.B.A. DEGREE EXAMINATION, DECEMBER 2017.
First Semester
FINANCIAL AND MANAGEMENT ACCOUNTING
(Upto 2012 13 Academic year and 2013 Calendar year)
Time Three hours Maximum 100 marks
PART A — x 8 40 marks)
Answer any FIVE questions.
1. Distinguish between financial accounting and
management accounting.
2. Discuss in detail the error that are disclosed by trial
balance.
3. Explain the limitations of financial statements.
4. Brief down the procedure for preparation of a fund flow
statement.
5. How are budgets classified?
6. Explain in detail the concept of capital rationing with an
illustration.
7. Bring out the importance of capital budgeting.
8. How will you calculate cash from operations?
PART B — x 15 60 marks)
Answer any FOUR questions.
9. Explain in detail the different concepts of accounting.
10. Write the procedure for preparation of final accounts
from incomplete records.
Sub. Code
14
DE-3140
2
SER
11. Discuss the managerial uses of cash flow statements.
12. Write short notes on
NPV
IRR
PBP.
13. The following are the balances of Mr. X on 30.6.2015.
Rs. Rs.
Capital 1,86,000 Purchase returns 1,500
Drawings 15,735 Cash at bank 7,890
Opening stock 17,280 Cash in hand 1,620
Creditors 18,900 Insurance paid 1,800
Debtors 43,500 General expenses 9,000
Machinery 60,000 Salaries 45,000
Patents 22,500 Wages 25,440
Land 30,000 Factory fuel and power 14,190
Buildings 96,000 Carriage on purchases 6,120
Sales 2,96,340 Carriage on sales 9,600
Purchases 1,22,025 Rent received 27,000
Sales returns 2,040
Prepare final accounts after incorporating the following
adjustments.
Stock on 30.6.2015 Rs. 20,4000
on sundry debtors is to be written off as bad
Salaries for the month of June 2015 amounting to
Rs. 4,500 were unpaid
Insurance include a premium of Rs. 510 on a policy
expiring on 31.12.2015.
Rent Rs. 3,000 is accrued but not received
Depreciate Machinery 10% and Patents 20%.
DE-3140
3
SER
14. The following are the balance sheet of a concern as on
31.3.2013 and 31.3.2014.
Liabilities 2013 2014 Assets 2013 2014
Share capital 60,000 65,000 Goodwill 30,000 25,000
P and L A/C 34,000 26,000 Plan and Machinery 60,000 50,000
Current Current Assets 16,000 19,000
Liabilities 12,000 3,000
1,06,000 94,000 1,06,000 94,000
Depreciation of Rs. 20,000 on Plant and Machinery
was charged
Dividend of Rs. 12,000 was paid during the year.
Prepare a schedule of changes in working capital and a
statement showing the sources and applications of funds.
15. The Alpha Company is considering the purchase of a new
machine. Two alternative machines A and B have been
suggested, each having an initial cost of Rs. 4,00,000 and
requiring Rs. 20,000 as additional working capital. The
cash inflows are expected to be as follows
Year Machine A Machine B
1 40,000 1,20,000
2 1,20,000 1,60,000
3 1,60,000 2,00,000
4 2,40,000 1,20,000
5 1,60,000 80,000
The company has target return on capital of 10% and you
are required to advice the company about the
acceptability of the machines based on NPV method.
(Hint P.V. Factor at 10% .909, .826, .751, .683, .621).