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.
All questions carry equal marks.
1. Explain briefly about the accounting concepts.
2. What do you understand by subsidiary books? Describe
the objectives of preparing them.
3. Explain the different types of errors with suitable
example and state how they affect the trial balance.
4. What is the need for financial analysis? How does the
ratio analysis technique help in the financial analysis?
5. Explain the following ratios
Gross profit ratio.
Stock turnover ratio.
Proprietary ratio.
Debt-equity ratio.
Sub. Code
14
DE-838
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WS 20
6. Distinguish between funds flow statement and cash flow
statement.
7. Explain the objectives and limitations of budgetary
control.
8. What are the different methods of capital budgeting
appraisal?
PART B — × 15 60 marks)
Answer any FOUR questions.
All questions carry equal marks.
9. funds flow statement is a better substitute for an
income statement'. Discuss.
10. Explain the objectives and importance of capital
budgeting.
11. What is Management Accounting? Distinguish between
Management Accounting and Financial Accounting.
12. From the following balance sheet of Arth Ltd., calculate
solvency ratios.
Balance Sheet
Liabilities Rs. Assets Rs.
Equity share capital 2,00,000 Goodwill 1,20,000
Reserve 40,000 Fixed assets (at cost) 2,80,000
P L account 60,000 Stock 60,000
Secured loan 1,60,000 Debtors 60,000
Creditors 1,00,000 Advances 20,000
Provision for taxation 40,000 Bank 60,000
6,00,000 6,00,000
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WS 20
13. From the following Balance Sheet of Kavitha Industries
Ltd., prepare a funds flow statement for the year
1999-2000.
Balance Sheet
Liabilities 98-99 99-2000 Assets 98-99 99-2000
Rs. Rs. Rs. Rs.
Share capital 2,00,000 2,10,000 Land 1,00,000 1,20,000
Profit and Loss A/c 28,000 49,000 Investments 28,000 48,000
Bank loan 10,000 Stock 58,000 54,000
Creditors 39,000 30,000 Debtors 53,000 59,000
Cash at bank 28,000 18,000
2,67,000 2,99,000 2,67,000 2,99,000
14. From the following particulars, prepare production cost
budget for the month of December 2000.
Particulars Opening stock Closing stock
(1.1.2000) (31.12.2000)
Finished goods 1200 units 1600 units
Raw material A 5000 kg 4800 kg
Raw material B 2000 kg 3100 kg
Budgeted sales for the month 7000 units.
Raw materials required to produce one unit A 4 kg
at Rs. 8 per kg B 2 kg at Rs. 25 per kg.
15. Two Projects M and N which are mutually exclusive are
being under consideration. Both of them require an
investment of Rs. 1,00,000 each. The net cash inflows are
estimated as under
Year M N
Rs. Rs.
1 10,000 30,000
2 40,000 50,000
3 30,000 80,000
4 60,000 40,000
5 90,000 60,000
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WS 20
The company's targeted rate of return on investment is
12%. You are required to assess the projects on the basis
of their present values, using NPV method and
profitability index method.
Year Present value of Rs.1 at 12%
1 0.893
2 0.797
3 0.712
4 0.636
5 0.567