MCA 1104
2354-1/01

M.C.A. DEGREE EXAMINATION - 2001
First Year - First Semester

MANAGEMENT ACCOUNTANCY

(Effective from the Admitted Batch of 2000 - 2001)

Time: Three hours
Maximum: 75 marks

Answer question No. 1 is compulsory
Answer any Four from the remaining questions.

1. Answer any THREE of the following:

(a) State the uses of P/V ratio.

(b) What are the features of master file?

(c) When does the flow, of fund occur?

(d) Explain the different forms of presenting ratios.

(e) State the errors which are not disclosed by trial balance.

2. Is accounting a science or an art or both? State the objects of preparing subsidiary books.

3. Discuss the nature, significance and principles of costing.

4. Describe the different methods of preparing cash budget.

5. Explain the process of preparing break even chart. What are the limitations of it?

6. Enter the following transactions in cash book with discount, cash and bank columns:

2000
Dec. 1 Cash in hand Rs. 16,000
2 Opened a bank account with Rs. 7,000
3 Cash purchases Rs. 600
4 Received a cheque of Rs. 400 from prabhakar and gave him discount of Rs. 25
6 Cash sales Rs. 1,200
7 Received a cheque of Rs. 100 from Venu for interest
9 Salary paid to the manager by cheque Rs. 450
11 Withdrew from bank for personal use Rs. 300
15 Purchased a bicycle for office use Rs. 300
18 Paid office rent Rs. 80

2000
Dec. 20 Sold goods for cash Rs. 900
22 Purchased Government bonds for Rs. 700
25 Paid travelling allowance to the manager Rs. 150
27 Received Commission Rs. 175
28 Gave a cheque to Ajantha for advertisement Rs. 50
29 The cheque received from Prabhakar on 4th Dec. Was dishonoured
31 Cash in excess of Rs. 2,000 was paid into the bank

7. From the following Trial Balance prepared from the books of Laxmi Narain on 30th June 2000, prepare Trading and Profit and Loss Account and a Balance Sheet.

Dr.		Cr.
Rs.		Rs.

Laxmi Narain's Capital and drawings	10,550 	1,19,400
Bills receivable				9,500 
Purchases and sales				2,56,590	3,56,430


Dr.		Cr.
Rs.		Rs.

Stock on 1st July 1999			89,680
Commission							5,640
Plant and machinery				28,800
Salaries					11,000
Travelling expenses				1,880
Debtors (including Mohan for
dishonoured cheque Rs. 1,000)		62,000
Stationery					2,000
Telephone charges				1,370
Interest and discount				5,870
Bad debts					3,620
Fixtures and fittings				8,970
Creditors							59,630
6% Loan							20,000
Wages						40,970
Cash in hand					530
Cash at bank					18,970
Cash at bank					18,970
Insurance (including premium of
Rs. 300 per annum paid up to
31st December, 2000)			400

Rent and taxes				5,620
====== 	======
5,61,100 	5,61,100

Stock in trade on 30th June, 2000 was Rs. 1,28,960. Write off half of Mohan's cheque. Create Provision. of 5 percent on debtors. Manufacturing wages include Rs. 1,200 for erection of new machinery purchased last year. Depreciate plant and machinery by 5 percent and fixtures and fittings by 10 percent per annum. Commission accrued Rs. 600, Interest on loan for the last two months is not paid.

8. X Ltd. manufactures 10,000 units of product X at a cost of sales of Rs. 80 per unit and there is a home market for the entire production at a selling price of Rs. 85 per unit. In the year 2000, there is a fall in the home market, which can consume 10,000 units at a selling price of Rs. 74.40 per unit. The analysis of cost of sales for 10,000 units discloses:

Rs.

Materials 		3,00,000
Wages 		2,20,000
Factory overhead 	1,60,000
Variable overhead 	1,20,000

The foreign market is also explored and it is ascertained that this market can consume 20,000 units of the product, if offered at a selling price of Rs. 71 per unit. It is also discovered that for additional 10,000 units of product, the fixed overhead will increase by 10%. Is it worthwhile to try to capture foreign market?