JAYA COLLEGE OF ARTS AND SCIENCE

DEPARTMENT OF MANAGEMENT STUDIES AND COMMERCE

REVISION I

Class: I MCOM Date:

Subject: Advanced Cost and Management Accounting Max Marks: 075

Sub code: Time: 3 Hours

PART A

Answer any ten questions: - (10 x 1 = 10 marks)

1. Define the term Ratios.

2. What is mean by Operating Ratio?
3. What is mean by Capital Gearing Ratio?
4. Define the term Fund Flow Statement.
5. What is mean by Funds From Operation?
6. Define the term Cash Flow Statement.
7. What is Work Capital Ratio?
8. Define the term Budgeting.
9. What is mean by Financial Analysis?
10. What is mean by ZBB?
11. What is mean by Fixed Budget?
12. What is Semi-Variable expenses?

PART B

Answer any five questions: - (5 x 5 = 25 marks)

13. The following information is obtained from the books of Sunil Enterprise Ltd.
Profit after Tax Rs.2,77,000
Equity Dividend Paid 20%

Market price of Equity Shares Rs.50 per share

The Company’s share capital consists of the following:

40,000 equity shares of Rs.20 each
30,000 preference shares of Rs.10 each

Calculate price earning ratio

14. A Trader purchase goods both on cash as well as on credit terms. The following particulars are obtained
from the books:
Rs.
Total purchases (gross) 2,00,000
Cash purchases 20,000
Purchase returns 34,000
Creditors at the end 70,000
Bills payable at the end 40,000
You are required to
(1)Calculate creditors turnover ratio
(2)Calculate average payment period
 15. Calculate Funds From Operations from the following Profit and Loss A/c
Profit and Loss A/C
Particulars Rs. Particulars Rs.
To Expenses 3,00,000 By Gross profit 4,50,000
To Depreciation 70,000 By Gain on sale of land 60,000
To loss on sale of 4,000
machine
To Discount 200
To Goodwill 20,000
To Net Profit 1,15,000
________- ______________
5,10,000 5,10,000

16. Venkatesh Babu Ltd. Expects the following sales by months in units for the first 6 months of next year

Jan 5,400
Feb 5,700
March 7,500
April 5,700
May 6,000
June 4,500
The Company has a policy of maintaining an inventory equal to budgeted sales for the following two
months. The beginning inventory also reflects this policy. Each unit costs of Rs.10.

You are required to prepare purchase budget for as many months as you can in units and in rupees.

17. Rajan supplies components to I C F on contract basis. For the year 2000, he agrees to supply 20,000 units
at Rs.80 per unit. The following were his costs during 1999 for supply of 15,000 units
Materials Rs.8 per unit
Wages Rs.22 per unit
Overheads Rs.20 per unit (60% fixed)
Other expenses Rs.5 per unit (100% fixed)
Prepare Budget for the year 2000, showing clearly the budgeted profit.

18. Write the differences between Fund Flow Statement and Cash Flow Statement.
19. Explain the different Types of Budget.
PART C

Answer any four questions: - (10 x 4 = 40 marks)

20. From the following information, you are required to prepare a Balancesheet
(a) Current ratio : 1.75
(b) Liquid ratio : 1.25
(c) Stock Turnover ratio(cost of sale/cl stock) : 9
(d) G.P Ratio : 25%
(e) Debt Collection period : 1.5 months
(f) Reserves and surplus to capital : 0.2
(g) Fixed asset turnover (on cost of sales) :1.2
(h) Capital gearing ratio (Long-term debt to share capital):0.6
(i) Fixed asset to networth :1.25
(j) Sales for the year :12,00,000
21. The Comparative B/S of Mr. X for the two year were as follows:
Liabilities 1988 1989 Assets 1988 1999
Capital 1,50,000 1,75,000 Land and 1,10,000 1,50,000
Loan from 1,60,000 1,00,000 building
Bank Machinery 2,00,000 1,40,000
Creditors 90,000 1,00,000 Stock 50,000 45,000
Bills Payable 50,000 40,000 Debtors 70,000 80,000
 Loans from __________ 25,000 Cash 20,000 25,000
IFC 4,50,000- 4,40,000 4,50,000 4,40,000

Additional Information:
Net profit for the year 1989 amounted to Rs.60,000
During the year a Machine costing Rs.25,000(Accumulated depreciation Rs.10,000) was sold for
Rs.13,000
The provision for Depreciation against machinery as on 31.12.88 was Rs50,000 and on 31.12.89
Rs. 85,000
You are required to prepare a Cash Flow Statement

22. The expenses Budgeted for Production of 10,000 units in a factory are furnished below:

Per Unit(Rs.)

Materials 70

Labour 25

Variable Overhead 20

Fixed Overhead(Rs.1,00,000) 10

Variable expenses(Direct) 5

Selling Expenses (10% Fixed) 13

Distribution Expenses(20% Fixed) 7

Administration Expenses (50,000) 5

Fixed for all levels

Total cost per unit (to make and sell) 155

Prepare a Flexible budget for the production of (a) 8,000 units and (b) 6,000 units

23. From the following information show the results of operations of a manufacturing concern using Trend
Percentages with 1987 as a base year
(Amount in ‘000 s)
Particular 1990 1989 1988 1987
Sales 1,300 1,200 950 1,000
Cost of goods sold 728 696 589 600

Gross profit 572 504 361 400

Total selling exp 120 110 97 100
452 394 264 300
Net operating profit

24. Briefly explain the Classification of Ratios.