Jawaharlal Nehru Technological University, Hyderabad MCA-I Semester Supplementary Examinations July 2010 ACCOUNTING AND FINANCIAL MANAGEMENT Question paper

Code No: 21005

Time: 3hours Max.Marks:60

Answer any Five questions
All questions carry equal Marks

1.a) Explain the different categories in which the accounting transactions can be classified. Also state the rules of debit and credit in this connection.
b) Differentiate between Management Accounting and Cost Accounting. How Financial Accounting is different from these two accounting systems?

2. Explain various steps in MIS development. What are the principles and objectives of MIS?

3. Explain the following:
a) Overheads
b) Operating Costing
c) Batch Costing
d) P/V Ratio
e) Semi-Fixed Costs
f) Margin of Safety

4. The following are the summarized balance sheet of X company as on December 2002 and 2003.
Liabilities 2002 2003 Assets 2002 2003
Share Capital 200000 250000 Lands& Buildings 200000 190000
General Reserve 50000 60000 Machinery 150000 169000
Profit & Loss A/C 30500 30600 Stock 100000 74000
Bank Loan(LT) 70000 ---- Sundry Debtors 80000 64200
Sundry Creditors 150000 135200 Cash 500 600
Provision for Taxation 30000 35000 Bank ---- 8000
Goodwill --- 5000 530500 510800 530500 510800
Additional Information:
During the year ended 31st December, 2003
(1) Dividend of Rs 2300 was paid.
(2) Assets of another company were purchased: Stock 20,000, Machinery 25,000.
(3) Machinery was further purchased for Rs.8,000.
(4) Depreciation written off on machinery Rs.12,000.
(5) Income Tax provided during the year Rs.33,000.
(6) Loss on sale of machinery Rs.200 was written off to General Reserve.
Cont…2
You are required to prepare:
(a) Statement of changes in a/c
(b) Funds Flow Statement and
(c) Cash Flow Statement.

5. With the following ratios and further information given below, prepare a trading and Profit and Loss A/C and Balance Sheet.
(1) Gross Profit Ratio 25%
(2) Net Profit Ratio 20%
(3) Stock Turn over Ratio 10
(4) Net Profit/Capital = 1/5, Capital to Total Liabilities 1/2, Fixed assets to capital 5/4, Fixed Assets/Total Current Assets = 5/7, Fixed Assets = 10,00,000, Closing Stock = Rs.1,00,000.

6.a) Explain various steps that are involved in Capital Expenditure Budget.
b) Define Budgeting Control and State its objectives.

7. Vinayak Ltd has furnished you the following information for the month of August, 2009.
Particulars Budget Actual
Output(Units) 30000 32500
Hours 30000 33000
Fixed Overheads Rs.45000 Rs.50000
Variable Overheads Rs.60000 Rs.68000
Working Days 25 25
Calculate the Variances and give inferences.

8. A choice is to be made between two competing projects which require an equal investment of Rs.50,000 and are expected to generate net cash flows as under:
End of the year Project-I (Rs) Project-II (Rs)
1 25000 10000
2 15000 12000
3 10000 18000
4 NIL 25000
5 12000 8000
6 6000 4000
The cost of capital of the company is 10%. Using NPV and PBP recommend which project is advisable.