mba-1-sem-accounting-for-managers-jan-2010

mba-1-sem-accounting-for-managers-jan-2010

February 2010

Master of Business Administration (MBA) Examination

1 Semester

Accounting For Managers

Time 3 Hours                                                                                                       Max. Marks 80

Note- Attempt any two questions from Section A. Each question of Section A carries 10 marks. Attempt any three questions from Section 13. Each question of Section B carries 20 marks.

Section A)

1.         Explain the following and show in each case what problems may have to be faced if it is not followed :

(a) Business Entity Concept               (b) Dual Aspect Concept

(c) Matching Concept                         (d) Convention of Conservatism.

2. What do you mean by Cost Accounting? Explain the nature, role and scope of Cost Accounting. What are the objectives of Cost Accounting? Explain in brief.

3.         Differentiate between any two of the following :

(a)        Capital Expenditure and Revenue Expenditure

(b)        Financial Accounting and Management Accounting

(c)        Joint Product Cost and By Product Cost.

4.         Write short notes on : (any two)

(a)        Bank Reconciliation Statement

(b)        Target Costing and Activity Based Costing

(c)        Cost Control and Cost Reduction.

(Section A)

5.         A company purchased a secondhand machinery on 1st January, 2007 for Rs. 35,000 and spent Rs. 3,000 on its repairs and Rs. 2,000 on its erection. On 1st July, 2008, it purchased another machine for Rs. 10,000. On 1st July, 2009, it sold the first machine which was purchased on 1st January, 2007 for Rs. 28,000. On the same date, it purchased a new machine for Rs 25,000. On 1st July, 2009 the second machinery purchased for Rs. 10,000 on 1st July, 2008 2as.sold for Rs. 2,000.

Depreciation was provided on machinery at the rate of 10% on the original cost annually on 31st December. In year 2008, however the company changed the method of providing depreciation and adopted the written down value method @15% p.a. Give Machinery Account for the four years commencing from 1st January, 2007 to the end of 2009. Do the calculations to the nearest

6.         the following Trial-Balance of M/s Dlvya Jyotl has been prepared on 31st March, 2009 :

Particulars                                       Amount Re.       Particulars                               Amount Re.

Debtors                                           37.500                Capital                                     71,000

Stock on 313-2009                         20,500                Sales                                        3,00,000

investment                                      10,000                Reserve for Doubtful Debts   2,500

Cash                                                10.500                Creditors                                 18,825

Purchases (adjusted by                                              Outstanding Wages               

Stock Acconb)                                                           on 1.4-2008                             900

Wages                                             1,93,500             Cash Discount                         4,500

Carriages on purchases                   18,000                                                               

Prepaid Insurance (1-4-2008)         625                                                                    

Accrued Interest (31-3-2009)         300                                                                    

Bad debts                                       600                                                                    

Rent and Insurance                        7,750                                                                 

Salary                                              13,500                                                               

Furniture                                         10,500                                                               

Plant of Factory                              50,000                                                               

income Tax                                     2,000                                                                 

                                                        3,98.525                                                             3,98,525.

 

Adjustments :

(a)        On 1st October, 2008 plant worth Rs. 10,000 was purchased on credit but no entry has been passed.

(b)        Outstanding Expenses on 31st March 2009: Rent Rs. 500; Salary Rs. 600.

(c)        Repaid Expenses on 31st March, 2009 :Insurance Rs. 250; Wages Rs. 400.

(d)       Goods worth Rs. 2,750 Were taken for the personal use by the owner but no entry has been made.

(e)        Write off depreciation on plant of factory 010% per annum.

(f)        Write off Rs. 500 from debtors and maintain the Reserve for doubtful debts @4% on remain debtors.

Prepare Final Accounts considering the above adjustments.

7.         Devine Jwellers fumishesh you the following information for the year  ended on 31st March, 2009 :

First-half                     Second-half

Turnover                      Rs. 8,10,000                Rs. 10,28,000

Profit Earned              Rs. 21,800                   Rs. 64,800

From the above you are required to compute the following considering that the. fixed cost remains the same in both the periods.

(a)        PN Ratio

(b)        Fixed Cost

(c)        The amount of profit or loss when sales Rs. 6,48,000            .

(d)       The amount of turnover required to earn a profit of Rs. 1,08,000

8.         The standard material cost to produce one ton of chemical D is :

300 kgs. of chemical A @ Rs. 10 per kg.

500 kgs. of chemical B @ Rs. 5 per kg.

500 kgs. of chemical C @ Rs. 6 per kg.

During the year ended on 31st March, 2009, 100 tons of chemical D were produced from the usage of :

35 tons of chemical A @ Rs. 9,000 per ton

42 tons of chemical B @ Rs. 600 per ton

53 tons of chemical C @ Rs. 7,000 per ton.

Calculate : '

(a) Material Cost Variance      (b) Material Usage Variance

(c) Material Price Variance     (d) Material Sub-usage Variance

(e) Material Mix Variance.

9.         M/s Dhirendra Jain & Company is a firm of Government Contractors. The firm took a contract for Rs. 5,00,000 on 1st April, 2008 and the following expenses were incurred on it 31st March 2009:

Rs.

Material purchased and sent directly at the site         62,500

Material issued from stores                                         50,000

Plant issued and debited to the contract                    30,000

Wages paid                                                                 65,000

Wages outstanding                                                     14,500

Office and Administrative expenses                          10,500

Material not found suitable for the contract,

returned to stores back                                                5,000

Cash received upto 31 March, 2009 amounted to Rs. 2,10,000 being 75% of the work certified. Materials valued Rs. 6,000 and plant costing Rs. 5,000 were destroyed due to fire occured at the site. On 31st March, 2009 plant costing Rs. 5,000 returned to stores and the materials costing Rs. 5,000 were sold for Rs. 9,000 The cost of work done but not certified was RS. 15,000 Materials at site were valued at Rs. 8,000.

Charge depreciation @ 10% on plant, Reserve 1/4 of the profit received, transfer 3/4 of profit received to P and L A/c and Prepare Contract Account.