M. B. A. (Semester-I) Examination FINANCIAL MANAGEMENT Total Marks - 100 SECTION - A Note: Attempt any five questions
Total Marks: 50
1- ‘Accounting is a service function’. Discuss the statement in the context of a modern manufacturing business. 2- What is the position in India regarding the formulation and enforcement of accounting standards? 3- Prepare a statement of cost showing: (a) value of materials consumed (b) total cost of production (c) cost of goods sold and (d) the amount of profit From the following details relating to a toy manufacturing concern: Opening stock: raw materials 25,000 Finished goods 20,000 Raw materials purchased 2, 50,000 Wages paid to labourers 1, 00,000 Closing stock: raw materials 20,000 Finished goods 25,000 Chargeable expenses 10,000 Rent, rates and taxes (factory) 25,000 Motive power 10,000 Factory heating and lighting 10,000 Factory insurance 5,000 Experimental expenses 2,500 Waste materials in factory 1,000 Office salaries 20,000 Printing and stationery 1,000 Salesmen’s salary 10,000 Commission to travelling agents 5,000 Sales 5, 00,000 4- Kolam products ltd. produces a stabilizer that sells for rs.300. An increase of 15% in the cost of materials and 10% in the cost of labour is anticipated. If the only figures available
M. B. A. (Semester-I) Examination FINANCIAL MANAGEMENT Total Marks - 100 are those given below, what must be the selling price to give the same percentage of gross profit as before? Material costs have been 45% of cost of sales Labour costs have been 40% of cost of sales Overhead costs have been 15% of the sales The anticipated increased costs in relation to the present sale Price would cause a 35% decrease in the amount of present gross Profit 5- What is meant by cost-volume-profit analysis? Explain its application in managerial decision making. How would you construct a break-even chart? 6- A company is considering expansion. Fixed costs amount to Rs.4, 20,000 and are expected to increase by Rs.1, 25,000 when plant expansion is completed. The present plant capacity is 80,000 units a year. Capacity will increase by 50 percent with the expansion. Variable costs are currently rs.6.80 per unit and are expected to go down by re.0.40 per unit with the expansion. The current selling price is rs.16 per unit and is expected to remain the same under either alternative. What are the breakeven points under either alternative? Which alternative is better and why? SECTION - B Note: Attempt any three questions
Total Marks: 30
1-A company is considering a reduction in the price of its product by 10% because it is felt that such a step may lead to a greater volume of sales. It is anticipated that there will be no change in total fixed costs or variable costs per unit. The directors wish to maintain profit at the present level. 220 You are given the following information: Sales (15,000 Units) Rs.3,00,000 Variable Cost Rs.13 Per Unit Fixed Cost Rs.60,000 From the above information, calculate P/V ratio and the amount of sales required to maintain profit at the present level after reduction of selling price by 10%. 2-You are the management accountant of XYZ CO. Ltd. The Managing director of the company seeks your advice on the following problem: the company produces a variety of products each having a number of computer parts. Product “B” takes 5 hours to produce on machine no.99 198 working at full capacity. “bB” has a selling price of rs.50 and a marginal cost, Rs.30 per unit. “A-10” a component part could be made on the same machine in 2 hours for marginal cost of
M. B. A. (Semester-I) Examination FINANCIAL MANAGEMENT Total Marks - 100 Rs.5 per unit. The supplier’s price is Rs.12.50 per unit. Should the company make or buy “A10”? Assume that machine hour is the limiting factor. 3- Beta manufacturers ltd. has supplied you the following information in respect of one of its products: Total Fixed Costs is 18,000 Total Variable Costs is 30,000 Total Sales is 60,000 Units Sold is 20,000 Find out (a) contribution per unit, (b) break-even point, (c) margin of safety, (d) profit, and (e) volume of sales to earn a profit of Rs.24, 000. 4- Explain the significance of funds flow analysis and cash flow analysis. Distinguish between schedule of changes in working capital and funds flow statement.
SECTION - C Note: Attempt any four questions 12345-
Total Marks: 20
Explain the accounting concept and conventions with suitable examples. Explain the difference between cost accounting and management accounting. Explain the recent SEBI guideline for buy back of securities. Explain the concept of responsibility centers. What are the advantages and limitations of standard costing?
