ELEMENTS OF MANAGEMENT ACCOUNTING MODEL QUESTION PAPER DIPLOMA IN COMMERCIAL PRACTICE

GOVERNMENT OF KARNATAKA

DEPARTMENT OF TECHNICAL EDUCATION

BOARD OF TECHNICAL EXAMINATIONS

DIPLOMA IN COMMERCIAL PRACTICE

MODEL QUESTION PAPER

9CP61 - ELEMENTS OF MANAGEMENT ACCOUNTING (EMA)

Time: 3 Hours                                                                                                       Max.Marks: 100

Instruction:      1) Section – I and IV are Compulsory

                        2) Answer any THREE Questions from Section – II

                        3) Answer any TWO Questions from Section – III

 

SECTION – I

 

1. (a) Fill in the blanks with appropriate word/words:                                                  5 X 1 = 5

 

(i)                 The Term...................refers to the numerical or quantitative relationship between two figures.

(ii)               .................means change in Fund or change in Working Capital.

(iii)             .................means Inflow and Outflow of Cash during Accounting Period.

(iv)             Total Sales minus the Sales at Break Even Point is known as the.............. of Safety.

(v)               The Word ‘Budget’ is derived from a French term..............which denotes a Leather Pouch in which funds are appropriated for meeting anticipated expenses.

 

            (b) Distinguish between Management Accounting and Financial Accounting.      5 Marks

 

SECTION – II

 

                                  (Answer any THREE Questions from this Section)                 10 x 3 = 30

      2. What do you understand by ‘Management Accounting’? Briefly describe its Objectives.

.                                                      10 Marks

  1. On the basis of following information, calculate:

(a) Gross Profit Ratio              (b) Working Capital Turnover Ration

(c) Debt-Equity Ratio

 

Particulars

Rs.

Net Sales

Cost of Goods Sold

Current Assets

Current Liabilities

Paid up Share Capital

Debentures

Loan

30,00,000

20,00,000

6,00,000

2,00,000

5,00,000

2,50,000

1,25,000

    10 Marks

 

  1. From the following Balance Sheets of a Company, prepare a Statement showing the Changes in Working Capital.

 

BALANCE SHEETS

 

LIABILITIES

2008 Rs.

2009 Rs.

ASSETS

2008 Rs.

2009 Rs.

Creditors

Capital

Profit & Loss A/c

7,000

20,000.

1,000

4,500

25,000

2,300

Cash

Debtors

Land

Stock

3,000

12,000

5,000

8,000

4,700

11,500

6,600

9,000

 

28,000

31,800

 

28,000

31,800

 

                                           10 Marks

 

  1. From the following Balances, you are required to Calculate Cash from Operations:

 

PARTICULARS

31.12.2008 Rs.

31.12.2009 Rs.

Debtors

Bills Receivable

Creditors

Expenses Outstanding

Expenses Prepaid

Accrued Income

Income Received in Advance

Net Profit Made

Bills Payable.

50,000

10,000

20,000

1,000

800

600

300

-

8,000

47,000

12,500

25,000

1,200

700

750

250

1,30,000

6,000

 

                                                             10 Marks

 

  1. Reddy Limited has prepared the following budget estimates for the year 2009 – 2010.

 

Particulars

.

Sales (in Units)

Fixed Expenses

Sales Value

Variable Costs

15,000

Rs. 34,000

Rs. 1,50,000

Rs. 6 per Unit

 

      Your are required to Compute the Following

(a) P/V Ratio, (b) Break-even Point and (c) Margin of Safety.                       10 Marks

 

 

 

SECTION – III

 

                                  (Answer any TWO Questions from this Section)                     2 x 15 = 30

 

  1. Prepare a Flexible Budget for Overheads on the basis of the following data. Ascertain the Overhead Rates at 70 % and 90% capacity.

 

Particulars of Cost

At 80 % Capacity Rs.

Variable Overheads:

Indirect Labour

Stores including Spares

Semi-variable Overhead:

Power (30 % Fixed, 70% Variable)

Repairs and Maintenance

(60 % Fixed and 40 % Variable)

Fixed Overheads:

Depreciation

Insurance

Salaries

Total Overheads

 

Estimated Direct Labour Hours

 

12,000

4,000

 

20,000

 

2,000

 

11,000

3,000

10,000

62,000

 

1,24,000

       15 Marks

 

7.      Dr.Aras & Kumar Company Limited shows the following Results for Two Years:

 

Year

Sales (Rs)

Profit (Rs)

2008

1,50,000

20,000

2009

1,70,000

45,000

 

                        From the above, you are required to calculate the following:

 

(a)    Profit-volume Ratio (P/V Ratio).

(b)   Break Even Point (BEP).

(c)    Sales required to earn a Profit of Rs. 40,000.

(d)   Margin of Safety at a Profit of Rs. 50,000.

(e)    Profit when Sales are Rs. 2, 50,000.

                                           15 Marks

 

 

 

 

  1. Dr.Aras and Reddy Limited supplies the following Balance Sheets for Two Years:

               

LIABILITIES

2008 Rs.

2009 Rs.

ASSETS

2008 Rs.

2009 Rs.

Share Capital

Bonds

Profit and Loss Account

Accounts Payable

Provision for Doubtful Debts

 

70,000

12,000

10,040

10,360

 

700

74,000

6,000

10,560

11,840

 

800

Cash at Bank

Debtors

Stock

Land

Goodwill

9,000

14,900

49,200

20,000

10,000

 

7,800

17,700

42,700

30,000

5,000

 

1,03,100

1,03,200

 

1,03,100

1,03,200

 

                Additional Information:

 

                                                                          i.      Dividends amounting to Rs. 3,500 were paid during the year 2009

                                                                        ii.      Land was purchased for Rs. 10,000

                                                                      iii.      Rs. 5,000 were written off on goodwill during the year.

                                                                      iv.      Bonds of Rs. 6,000 were paid during the year.

 

                                    Prepare a Cash Flow Statement. 

     15 Marks

 

  1. From the following Balance Sheets of Abiram Kumar Limited, you are required to prepare a Funds Flow Statement: 

               

LIABILITIES

2008 Rs.

2009 Rs.

ASSETS

2008 Rs.

2009 Rs.

Share Capital

Profit and Loss A/c

Current Liabilities

 

65,000

39,000

17,000

70,000

31,000

8,000

Goodwill

Plant & Machinery

Current Assets

35,000

65,000

21,000

 

30,000

55,000

24,000

 

1,21,000

1,09,000

 

1,21,000

1,09,000

 

            Additional Information:

 

(a)    Depreciation of Rs. 25,000 was charged on Plant and Machinery.

(b)   Dividends of Rs. 17, 000 was paid during the year. 

 

 

 

 

 

 

 

SECTION – IV

                                                     (This Section is Compulsory)                                20 + 10 = 30

 

  1. (a) From the following information, prepare a summarized Balance Sheet as on 31st

           December 2009 with as many details as possible:

 

                  Working Capital                                              : Rs. 75,000

                  Reserves and Surplus                                      : Rs. 1, 00,000

                  Bank Overdraft                                               : Rs. 60,000

                  Current Ratio                                                  :        1.75

                  Liquid Ratio                                                    :        1.15

                  Fixed Assets to Proprietary Funds Ratio        :        0.75

                  There is no Long term Loans nor any Investments in Fictitious Assets.

       20 Marks

(b) Answer any FIVE of the following:        

                                                     

a.        What is Funds Flow Statement?

ii.    What is Cash Flow Statement?

iii.   What is Budget?

iv.   What is Contribution?

v.    What is Ratio?

vi.   What is a Cash Budget?

vii.  What is Budgetary Control?

viii. What do you understand by ‘Items of Cash Flows’?                               2 x 5 = 10

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