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Management Accounting

Assignment -1
Q-1 What is management accounting? Discuss the various tools and techniques of
management accounting
Q-2 “Management accounting is presentation of accounting information in such a way so as
to assist the management in creation of policy and in day to day operation of an undertaking”
Elucidate this statement.
Q-3 Prepare the following statements from the balance sheet of Y Ltd. as on 31st
December, 2014 and 2015. You are required to prepare:

a) Schedule of changes in working capital

b) Funds flow statements.

Liabilities 2014 2015 Assets 2014 2015

Share capital 1,50,00 2,00,000 Goodwill 15000 12000

General reserve 15,000 20,000 Building 100000 142000

Profit & Loss A/C 15,000 12,000 Plant 35,000 40,000

Sundry Debtors 10,000 12,000 Non trading

Provision for investment 10,000 12,000

Taxation 15,000 20,000 Stock 15,500 12,000

Bill receivable 5,000 7,000

Provision for Debtors 20,000 25,000

Doubtful debts 500 1000 Cash 5,000 15,000

2,05,500 2,65,000 2,05,500 265000

Additional Information

a) Depreciation charged on Plant was 10,000 and on Building Rs 7,000

b) Provision for taxation of Rs 15,000 was made during the year 2015
c) Interim dividend of Rs 10,000 was paid during the year 2015

Q-4 From the following information you are required to prepare Balance Sheet.
Current Ratio 1.75
Liquid Ratio 1.25
Stock turnover Ratio(cost of sales/closing stock) 9
Gross profit ratio 25%
Debt collection period 1.5 months
Reserves and surplus to capital 0.2
Fixed asset turnover(cost of sales/fixed asset) 1.2
Capital gearing ratio(long term debt to equity capital) 0.6
Fixed asset to net worth 1.25
Sales during the year 12,00,000
Assignment -2

Q-1 From the following data calculate all the material variances:

Materials Standard Actual

A 8 Kgs @ Rs. 40 10 Kgs @ Rs. 30
B 12 Kgs @ Rs. 60 20 Kgs @ Rs. 68

Standard Yield is 90% of Input. Actual yield is 26.50 Kgs.

Q-2 With the following data of 60% activity, prepare budget for production oat
80% capacity

Production at 60% activity 600 units

Materials Rs. 100 per unit

Labour Rs. 40 per unit

Direct expenses Rs. 10 per unit

Factory overheads Rs. 40,000(40% fixed)

Administrative expenses Rs. 30,000 (60% fixed)

Q-3 A company annually manufactures 10,000 units of a product at a cost of Rs.4 per unit
and there is home market for consuming the entire volume of production at a sale price of
Rs.4.25 per unit. In the year 2009 there is fall in demand which can consume 10,000 units
only at sale price of Rs.3.72 per unit.
The analysis of cost per 10,000 unit is:
Materials Rs 15,000
Wages Rs 11,000
Fixed overheads Rs. 8,000
Variable overheads Rs. 6,000
The foreign market is explored and it is found that this market can consume 20,000 units
of product if offered at a sale price of Rs. 3.55 per unit. It is also discovered that for
additional 20,000 units to be sold at foreign market fixed cost will increase by 20%. Is it
worthwhile to try to capture the foreign market.

Q-4 What do you mean by marginal costing .Discuss its various applications