# Loyola College B.A. Corporate & Secretaryship April 2007 Management Accounts Question Paper PDF Download

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034          B.A. DEGREE EXAMINATION – CORPORATE & SECRETARYSHIP

 HO 15

SIXTH SEMESTER – APRIL 2007

# CR 6600 – MANAGEMENT ACCOUNTS

Date & Time : 16-04-2007/9.00-12.00                Dept. No.                                                              Max. : 100 Marks

###### SECTION – A

Answer all the questions.                                                                                                               10 x 2 = 20

1. What is ratio analysis?
2. Define ‘Budget’.
3. A project costs Rs. 5,00,000 and yields annually a profit of Rs. 80,000 after depreciation at 12% p.a. but before tax at 50%. Calculate pay-back period.
4. Define Fund Flow Statement.
5. Calculate Net profit ratio. Sales Rs.3,50,000,                                Cost of goods sold Rs.1,50,000

Administrative expenses Rs.50,000                                 Selling expenses Rs. 10,000.

1. Define financial statements.
2. Write the ‘Principles’ for preparation of Working Capital Statement.
3. Define current asset.
1. Suresh and company supplies the following information regarding the year ended 31-12-2000. Cash sales Rs. 80,000; Credit sales Rs. 2,00,000’ Return inward Rs. 10,000; Opening stock Rs. 25,000; Closing stock Rs. 30,000; Gross profit ratio is 25%; Find out inventory turnover ratio.
1. What is the objective of ‘cash budget’?

### SECTION – B

Answer any FIVE questions.                                                                                                                           5 x 8 = 40

1. Johnson Ltd. has Rs. 80,000 to invest. It has two alternative proposals at hand for consideration. The alternatives are:
 Product X Rs. Product Y Rs. Investment outlay Cash inflows: Year 1 2 3 4 80,000   32,000 32,000 36,000 — 1,00,000 80,000   30,000 30,000 30,000 10,000 1,00,000

Required:

1. Which investment proposal would you recommend under pay-back method?
2. Would your decision be different if proposal Y has Rs. 40,000 in the third year instead of Rs. 30,000 inflow?
1. Calculate the Debtors turnover ratio from the following.

Rs.

Total sales for the year 1987                            1,00,000

Cash sales for the year 1987                                20,000

Debtors as on 1-1-1987                                         10,000

Debtors as on 31-12-1987                                    15,000

Bills receivable as on 1-1-1987                              7,500

Bills receivable as on 31-12-1987                       12,500

1. From the following information show the results of operations of manufacturing concern using trend percentages with 2004 as base year.

(amount in ‘000s)

 Particulars 2001 2002 2003 2004 Sales Cost of goods sold Gross profit Total selling expenses Net operating profit 1,300 728 572 120 452 1,200 696 504 110 394 950 589 361 97 264 1,000 600 400 100 300
1. Explain the characteristics of management accounting.
2. You are required to calculate the following:

(a) Working capital turnover             (b) Fixed assets turnover    (c) Capital turnover

The information available is as under:

Capital employed : Rs. 4,00,000      Current liabilities : Rs. 40,000           Current assets ; Rs. 2,00,000

Net fixed assets : Rs. 2,50,000         Sales: Rs. 5,00,000                              Cost of sales: Rs. 4,00,000

1. What are the advantages of ratio analysis?
2. Explain the most important techniques of analysis and interpretation of financial statements.
3. Calculate funds from operations from the following profit and loss Account:

# Dr                                                                                                                                                                    Cr

Particulars Rs. Particulars Rs.

# To Expenses paid

To Depreciation

To Loss on sale of Building

To Discount

To Goodwill

To Net profit

1,00,000

40,000

15,500

500

12,000

52,000

———–2,20,000

By Gross Profit

# By Gain on sale of machinery

2,00,000

20,000

———–

2,20,000

### SECTION – C

Answer any TWO questions.                                                                                           2 x 20 = 40

Liabilities 2000

Rs.

2001

Rs.

### Assets

2000

Rs.

2001

Rs.

Share capital

General reserve

P & L A/c

B ank Loan

Creditors

Provision for taxation

1,00,000

25,000

15,250

35,000

75,000

15,000

2,65,250

1,25,000

30,000

15,300

67,600

17,500

2,55,400

Building

Machinery

Stock

Debtors

Cash in hand

Cash at bank

Investment

1,00,000

75,000

50,000

40,000

250

2,65,250

95,000

85,500

37,000

31,100

300

4,000

2,500

2,55,400

(a) dividend of Rs. 11,000 was paid                                (b) Machinery was purchased for Rs. 15,000

(c) Income tax paid during the year Rs. 16,500.  Prepare Cash Flow Statement.

1. Using the information given below prepare a cash budget showing expected cash receipts and

disbursement for the month of May and balance expected at May – 31 – 1986. Budgeted cash balance

May    1, 1986 R. 60,000.

Sales:

March    Rs. 5,00,000

April       Rs.  3,00,000

May       Rs.  8,00,000

Half collected in the month of sales, 40% in the next month and 105 in the third month.

Purchases:

April       Rs.  2,50,000

May       Rs.  4,00,000

40% paid in the month of purchase and 605 paid in the next month.

Wages due in May for Rs. 88,000. 3 years insurance policy due in May for renewal Rs. 2,000 to be paid in cash. Other expenses for May, payable in May, Rs.44,000. Depreciation for the month of May Rs. 2000. Accrued  taxes for May payable in December Rs. 6,000. Fixed deposit receipts due May 15th Rs. 1,75,000 plus Rs. 10,000 interest.

1. The cost of an article at a capacity level of 5,000 units is given below:

Rs.

Material cost                                        25,000   (100% variable)

Labour cost                                          15,000   (100% variable)

Power                                                       1,250    (80% variable)

Repairs                                                   2,000    (75% variable)

Stores                                                       1,000    (100% variable)

Inspection                                                  500    (20% variable)

Depreciation                                         10,000    (100% variable)

Selling overheads                                  3,000    (25% variable)

———

62,750

———

Cost per unit Rs. 12.55

Find the unit cost of the product at production levels of 4,000 units and 6,000 units.

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