DISTANCE EDUCATION
M.B.A. DEGREE EXAMINATION, MAY 2017.
First Semester
FINANCIAL AND MANAGEMENT ACCOUNTING
(Upto 2012-13 Academic year and 2013 Calendar year)
Time Three hours Maximum 100 marks
PART A — 8 40 marks)
Answer any FIVE questions.
1. Distinguish between financial accounting and
management accounting.
2. Explain in detail the errors that are disclosed and not
disclosed by trial balance.
3. Enumerate the limitations of financial statements.
4. Explain the uses of cash flow statement.
5. How will you prepare cost of production budget?
6. What are the features of capital budgeting?
7. Discuss in detail the different conventions of accounting.
8. What are the defects of single entry system of book
keeping?
Sub. Code
14
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PART B — 15 60 marks)
Answer any FOUR questions.
9. Write short notes on
Debt equity ratio
Budgetary control
Comparative Income statements.
10. How will you prepare final accounts from ratios and other
figures?
11. Distinguish between cash flow and fund flow statement
12. From the following details prepare final accounts of Mr. V
for the year ended 31-3-2012.
Capital 1,00,000 Furniture 15,000
Cash 1,200 Sales 2,00,200
Purchases 1,20,000 Bills receivable 20,000
Bills payable 22,000 Rent and taxes 10,000
Stock 1-4-2011 35,000 Wages 16,000
Debtors 50,000 Reserves for bad debts 1,000
Creditors 24,000 Salaries 20,000
Plant and machinery 60,000
Stock on 31.3.2012 40,000
Outstanding rent 2,000, wages 3,000 salaries 4,000
Provide depreciation on plant and machinery at 5
on furniture at 10%
Increase provision for bad and doubtful debts to
2.5%
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13. The following information is given to you
Rs.
Gross profit ratio on sales) 60,000
Share holder's equity 50,000
Credit sales to total sales 80%
Turnover to total sales 3 times
Stock turnover 8 times
Average collection period year 360 days) 18 days
Current ratio
Long term debt to equity 40%
Complete the given balance sheet from the above
information.
Assets Amount Liabilities Amount
Cash Current debts
Debtors Long-term debts
Inventory Share holder's funds
Fixed assets
Total Total
14. From the following prepare raw materials purchase
budget for Jan 2014.
Materials (units)
A B C D E F
Estimated stock on
1st Jan
16000 6000 24000 2,000 14000 28000
Estimated stock on
31st Jan
20000 8000 28000 4000 16000 32000
Estimated
consumption
120000 44000 132000 36000 88000 172000
Standard price per
unit
Rs. 25 Rs. 5 Rs. 15 Rs.10 Rs.20 Rs. 30
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15. Nalli Mills limited is considering 2 mutually exclusive
investment for an expansion programme. Proposal A
requires an investment of Rs.7,80,000 and B requires an
investment of Rs.5,10,000. The life of the equipment in
both the cases will be 12 years with no salvage value. The
anticipated increase in sales is Rs. 1,70,000 p.a. for both
the proposals and A will require additional expenses of
Rs.60,000 and B Rs. 1,20,000. The firm's tax rate is 40%
and its cost of capital is 15% and depreciation is
calculated on SLM. Suggest the best investment proposal
according to NPV method.
Note: Present value of an annuity of Re.1 at 15% for 12
years is 5.421.