mba-1-sem-accounting-for-managers-march-2013

mba-1-sem-accounting-for-managers-march-2013

March 2013

Master of Business Administration (MBA) Examination

I Semester

(Accounting for Managers)

Time 3 Hours)                                                                                                 (Max. Maiks 80


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

Each question of Section B carries 20 marks.

(Section A)

1.         Explain the basic concept and convention of accounting with suitable example. What is double entry system of accounting ? Discuss with golden rules of debit and credit.

2.         Discuss the scope and limitation of financial accounting. How is it different from cost accounting ?

3.         Write short notes with accounting application on the following :

(a)        Rectification of Error.

(b)        Classification of Cost.

4.         "Management accounting is an extension of financial accounting." Discuss the statement and also discuss the various tools of management accounting.

(Section B)

5.         X Ltd. purchased a machinery for Rs. 10,50,000 on July 01, 2009. On 01-01-2011 company replaced old machine with new one. Cost of new machine Rs..10,00,000 and price relaxed Rs. 1,50,000 in exchange of old machine. Company charges depreciation 20 per cent yearly with straight line method and now it requires to change the method of depreciation and apply Reducing Installment Method from 2009. Prepare Machinery Account for three year (2009- 2011), Assuming that the accounts are closed on 31st March every year.

6.         Prepare Final Account with the following details :

Trial Balance as on 31-12-2010

Particular                                  Amount (Rs.)          Particular                            Amount (Rs.)

Purchases                                  2,00,000                  Capital                                2,76,100

Stock                                        28,000                     Sales                                   3,05,000

Salaries                                     44,200                     Discount                             1,900

Wages                                       1,11,200                  Creditors                             50000

Discount                                   2700                       Outstanding Rent               4000

Sundry Debtors                        1,40,000                 

Cash                                          11,260                    

Bank                                         15,940                    

Insurance                                  4,400                      

Trade Expenses                        3,800                      

Printing                                     1,500                      

Furniture                                   20,000                    

Machinery                                 50,000                    

Prepaid Insurance                     200                         

Accrued Commission               3,800                      

                                                  6,37,000                                                              6,37,000

Adjustments :             

(a)        Closing Stock Rs. 1,50,000.

(b)        There is a mistake in valuation of opening stock. It was valued 20% less than its     actual value.

(c)        Prepaid insurance Rs. 600.      .

(d)       Outstanding liabilities : Wages Rs. 200 and Trade exp. Rs. 300

(e)        Bad debts Rs. 4,500 and provide reserve 2% on debtors.

(f)        Depreciate machine by 10% and furniture by 15%.

7.         Calculate material variances :

Material           Standard                                 Actual

                        Q (kg.) P(Rs)                           Q (kg.)             P(Rs.)

per kg.             pr kg.

X                     1500    20                                1600                23

Y                     1300    50                                1275                52

Z                      1150    30                                1145                35

                        3950                                        4020   

8.         Calculate BEP, Margin of Safety if sales is 5000 units and selling price Rs. 450 per unit.

Material           Rs. 120 per unit (variable exp.)

Wages             Rs. 75 per unit (variable exp.)

Overhead        Rs. 65 per unit (variable exp.)

Overhead        Rs. 2,80,000 (fixed).

Company wants to earn profit Rs. 5,50,000 Assumed that selling price has gone reduced in the market by 10 percent on selling price. Determine the amount of sales to earn desired profit.

9.         A contractor started contract on Oct. 1, 1997. Contract price Rs. 4,40,000. Detail as follows for the year 1998-99. Prepare Contract Account.

                                                                              Rs.

April 1, 1998                           WIP not certified              55,000

                                                Material at site                  2,000

1998-99                                   Exp. incurred

                                                Material issued                  1,12,000

                                                Wages                               1,08,000

                                                Hire of Plant                     20,000

                                                Other Exp.                        34,000

March 31,1999                        Material at site                  4,000

                                                WIP not certified              8,000

                                                Certified                            4,05,000

Cash received 80% of work certified.

It is estimated that further cost to complete the contract will be Rs. 23,000 including the material at site on 31- 3-1949.

Determine the profit on contract for the year 998-99 on a present basis which has to be credited to P/L A/c.