Birla Institute of Technology & Science, Pilani

Work-Integrated Learning Programmes Division

First Semester 2022-2023

COMPREHENSIVE EXAMINATION
(EC-3 Regular)

Course No. : MBA ZC415

Course Title : Financial and Management Accounting
Nature of Exam : Open Book
Weightage : 50% No. of Pages =4
Duration : 2.5 Hours No. of Questions = 6
Date of Exam : Sunday, 27/11/2022 (FN)
Note:
1. Please follow all the Instructions to Candidates given on the cover page of the answer book.
2. All parts of a question should be answered consecutively. Each answer should start from a fresh page.
3. Assumptions made if any, should be stated clearly at the beginning of your answer.

Q.1 Dutt Company’s Statement of Profit and Loss for the year ending June 30, 2022 and Relevant
Statement of Sources and Application of Funds as on June 30th, 2022 given below: [5]

Statement of Profit and Loss Rs.

Sales 75,800
Gain on sale of investment 1,200
Interest income 900
Dividend income 300
Total Income 78,200
Expenses
Cost of goods sold 45,000
Depreciation expense 6,700
Selling and administrative expenses 8,500
Loss on sale of equipment 800
Total expenses 61,000
Profit before tax 17200

Relevant Statement of Sources and Application of

funds on June 30 are as follows
Particulars 2021 2022
Inventories 9300 7900
Trade receivables 6600 5300
Prepaid expenses 1100 800
Trade payables 12600 19300

Selling and administrative expenses include bad debts expense of Rs. 1500. During the year ended
June 30, 2022 compute the cash flow from the operating activities.
Q.2 As an assistant manager, you have received the following Trail Balance, Prepare Statement of
Profit and Loss and Balance sheet of your company during the financial year 2021-22. [10]

Trail Balance as on 31.03.2022

Particulars Debit Credit (Rs)

(RS.)
Net Sales 2,82,250
Cash Balance 4,500
Purchase Return 2,000
Purchase of Raw Material 1,10,000
Sales Return 1,500
Wages paid to workers 20,000
Equity Capital 56,000
Accounts Payable 22,000
Power & Fuel Expenses 8,000
Carriage outwards 6,000
Carriage inwards 5,000
Opening Stock Inventory 6,000
Land 10,000
Plant and Machinery 1,25,000
Salaries paid to administrative staff 12,000
Office expenses 6,000
Insurance Premium Paid 1,000
Accounts Receivables Outstanding 15,000
Tax paid @30% on Net Profit 32,250
Total 3,62,250 3,62,250

Adjustments to be made are given below:

1. Closing stock of Inventory as on 31.03.2022valued at Rs.20,000

2. Create provision for bad & doubtful debts at 5%

3. Outstanding salaries Rs. 5,000, outstanding wages Rs. 3,000

4. Charge depreciation @ 10% on Plant and Machinery

Q.3 From the information given below calculate the following ratios: [5 x 2 = 10]
(i) Operating profit ratio
(ii) Current Ratio
(iii) Gross profit ratio
(iv) Inventory Turnover ratio
(v) Debt Equity ratio

S.no Particulars Amount

1 Equity Share Capital 2,50,000
2 12% Debentures 3,00,000
3 9% Preference share capital 1,50,000
4 Reserves and Surplus 50,000
5 Revenue from Operations 5,00,000
6 Opening Inventory 40,000
 7 Purchases 3,00,000
8 Wages 50,000
8 Closing Inventory 50,000
9 Selling and Distribution expenses 10,000
10 Other Current assets 2,50,000
11 Current Liabilities 1,50,000

Q.4 Answer the following [1 x 5 = 5]

(i) If Quick ratio is 3:1, Current assets are Rs.2,80,000/-, inventory is Rs.40,000/- what is
the value of current liabilities?
(ii) If the Debt Equity ratio is 2:1, what is the impact of purchase of fixed asset by taking
long term loan?
(iii) If Debtors are Rs.3,00,000/-, additional bad debts Rs.5,000/- and provision for bad debts
Rs.8,000/- what is the value of debtors considered for Debtors turnover ratio?
(iv) From the following information:
a. Profit after tax Rs.1,00,000/-
b. Equity share Capital (Face value Rs.10/-) Rs.2,00,000/-
c. 10% Preference capital Rs.1,00,000/-
d. Market price per share Rs.45/-

Compute the
 EPS and
 Price Earnings ratio

Q.5 From the following extract of costing information relating to a commodity for the half-year
ended 30th September, 2020, you are required to prepare the cost sheet. [7]

Purchase of Raw Materials

1,32,000
Direct Wages 1,10,000
Factory Rent
44,000
Carriage Inward 1,584
Stock on 1st April, 2020:
Raw Materials 22,000
Finished Products (1,600 tons)
17,600
Stock on 30th September, 2020
Raw Materials 24,464
Finished Products (3,200 tons) 35,200
Work-in-Progress:
1st April.,2020
5,280
30th September, 2020 17,600
Cost of Factory Supervision 8,800
Sales of finished production
3,30,000

 Advertising and other selling expenses are 75 Paise per ton sold.
 25,600 tons of the finished products were produced during the year.
Q.6 Compute the Selling price, BEP in units in the following question:
(Total Marks= 8)

(a) A company proposes to introduce new product in the market. It would like to maintain
P/V Ratio@ 25%. If the Variable Cost (VC) of the product is per unit is Rs.300/- what
should be the selling price per unit?
(Marks – 2)

(b) ABC Ltd. sold 55000 units of its product at Rs.375/- per unit. Variable costs are 185/-
per unit. Fixed costs incurred uniformly throughout the year amounted to
Rs.61,75,000/-. You are required to compute the following:

1. Breakeven point in units

2. P/V Ratio
3. No. of units that must to sold to earn EBIT of Rs.500000/-
4. Sales level to achieve an after-tax income (PAT) of Rs.500000/-
assuming a tax rate of 50%
(Marks – 4 x 1.5 = 6)

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