E L44O (Pages:4+3 =7) Reg. No....,4,5.5.*t5....e.oo...

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B.Com. DEGREE (C.B.C.S.S.) EXAMINATION, IUARCH 2018

Sixth-Semester
Core Course-ACCOUNTING FOR MANAGERIAL DECISIONS
(Common for Co-operation, Finance and Taxation and tlavel and Tourism)
[For Private Registration Candidates]
Time : Three Hours Weight:25
.Mrurimum
Instructions r, This question paper contains two sections. Answer Seetion I questions in the
answer-book prouided.. Section iI Internal Examination questions tnust be answered. in the question
paper itself. Follow the detailed instruct;ions giuen und.er Section IL
Answers rnay be writ$en either in English or in Malayalam.
Section I
P.lRr A (Oupcrrvu TVrn QtrnsrroNs)

Answer all questions.

Each bunch of forur questions carries a weight of l.
L Choose the correct answer from the choiees glven below

1 Comparison of financial data of a company for several years is called :

(a) Vertical analysis. '/ ft) Horizontal analysis.

(c) Ratio analysis. (d) None of the above.
2 Collection of book debts results in :

(a) Application of funds/ ft) Source of fund. .

(c) No flow of fund. (d) Increase in current assets.

'Tl
-;':: is:
(b) 1:2.
(c) 1:1. '/ (d) 3:1.
4 In the funds flow statement, depreciation is :

(a) Deducted from net profit. ft) qaAdded to net profit.

(r)/ A source of fund. (d) Ignored.
II. Fill in the blanks :

b Sales ratios may otherwise be called -{Ifr)ror.

6 Decrease in creditors is of cash.

Turn over
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7 Common-size income statements present the various items as a percentage of ._RlaA-
8 Sales minus gross profit is called Co crS .
III. State whether True or False :

I EPS stands for Earnings price Share.l

10 Sales + Gross profi.t = Gross profit ratio. {
11 Long termsolvencffif a firm can be measured. by debt equity ratio..t
L2 stock and prepaid expenses are not included in quick asset. *
fV. Match the following : .
13 Financial Statements (a) Owners equity.
)
L4 Profit centre Cb) Cash Flow Statement. $o
.15@
F -----
(c) Short-term Planning.
16 AS-3 (d) Static.1l
(e) Recorded facts. .9
(fl Responsibility Accounting...r.
(4xL=4)
Penr B
Answer any five questions.
Each question carries a weight of L.

*T Iffhat are financial statements'?

,/
L}zftlltatdo you understand by trend analysis ?

19 Give any iwo managerial uses of fund flow statement.

?./Is.depreciation a source of fund or application of fund ? Justifr your answer.
2L How will you determine cash from operations ?
2),zWhatis responsibility accounting ?

23 Explain'Proprietary Ratio'.
2{tWhat is'Current Asset' ?

(5x1=5)
Penr C

Answer any four questions.

Each question carries a weight of 2.
Answer should not ucceed half a page.
25 Discuss the limitations of financial statements
zS,.dirtingjrish between cash flow statement and fund flow statement.

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 ' 3 nL44O
' 27 Examine the relationship between solvency, liquidity and profitability.
l,YCompare horizontal and vertical analysis.
a2g From the following information, calculate, debtors turnover ratio and average collection
i " period:
Rs.
Tota1 debtors (opening balance) ... 2r00,000-J
... 1,5o,ooo--{ tr

r-f! Credit sales ... 10,00,00Qturi q

... . 7,80,000 -**-

\ l'r"'-"
Cash collected
Sales returns ... 60,000 -r"
Bad debts ... 401000
... 201000
Provision for bad debts !! o 251000
No. of days in a year - 360
30 From the following information extracted from the Balance Sheets of Star Ltd. for four previous
fiiancial years, calculate'the trend percentages taking 2010-11 as the base yea: :
//
2010-11 2oLL-Lz zotz-Ll' zo*g-L4
(Rs. in lakhs)
Current Assets ,
Cash
"
20p 240 400 220
Bank 260 300 200 240
Debtors 400 600 1,000 1,600
Stock 800 1,200 1,800 2,000
Non-Current Assets :
Building 1,000 1,200 1,200 1,200 L-.,

Plant and Machinery 2,000 2,400 2,400 2,800

4,660 5,940 7,ooo 8,060
(4x2=8)
PamD
Answer any two questions.
Each question carries a weight of 4.
Answer ruot to exceed four pages.
31 From the following information you are asked to perpare Balance Sheet :
(a) Current liabilities Rs. 1',00,000. (b) Resenres and Surplus Rs. 50,000.
(d) Debtors Rs. 35,000.
. (c) Bills payable Rs. 40,000.
(e) Current ratio L.75. (O Acid test ratio 1.15.
G) Fixed assets to proprietors fund 0.75. ft) Ratio of fixed assets to current assets 3.

I\rm over

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32 From the following informationrprepare cash from operations and'cash flow statement on
direct method :
2AL5 20L6 u'

Rt.' Rs.
Assets :

Cash balances ... 51000 3,500

Trade Debtors ,.. 151000 25,000 . ,.

Stock ... L7 ,500 L2,500

1'

Machinery ... 401000 27,500

Land .,: 201000 25,000
Building ,.. L7 ,500 30,000
Total 1,15,000 1,23,500
Capital arud Liabilities
Share Capital ...
a

62,500 76,500
r+\ f { t}
\r
{L\
E

L*_,

Long-term loans ... 20,000 25,000 rl,1.4

t'\ a 1.

L" '\.-J
-'. !t*
Mortgage loans ...
r .J.d 1 ':

12,500 ii l
"
l L
Creditors ... 20,000 22,000
Total 1,15,000 183S00
Additional information :

(a) During the year 20L6, a machine costing Rs. 5,000 (accumulated depreciation
Rs. 1,500) was sold for Rs. 2,500.
(b) The provision for depreciation against machinery during the year 2015 was Rs. 12,500
and Rs. 20,000 in 2016.
(c) Net profit earned during the year 2016 was Rs. 22,500.
e/trro the following relating to Henco Limited, perpare funds flow statement :
*/:
Balance Sheet of Henco Limited as on 31st December
Liabilities 20L5 20L6 Assefs 2AL5 20L6
(Rs.) (Rs.)
i. (Rs.) (Rs.)
Share capital ... 5,45,000 7,90,000 Machinery G.. 2,90,000 7,60,000
P & L Account ... 3,7A,000 4,65,000 Trade lVlaiks ... 6,20,000 5,70,000
Reserues ' ... 2,80,000 4,!0,000 Sundry Debtors ... 5,80,000 6,08,000
Loan from SBI ... 3,30,000 2,48,000 Closing stock ... 2,00,000 2,20,000
Bills payable ... 3,90,000 5,20,000 Prepaid insurance ... 33,000 10,000
Outstanding rent '...
45,000 35,000 Cash at Bank ... 2,37,000 3,00,000
TotaI 19,60,000 24,68,000 19,60,000 24}69,000
Additional information :

(i) Depreciation of Rs. 37,000 on P & M was charged to P & L Account.

(ii) A part of the machinery, having a book value of Rs. 37,500 was sold for Rs. 23,800.
(2 x 4 = 8)

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