Management Accounting Question Papers Pune University


Instructions to the candidates:

1) Question No.1 is compulsory.

2) Attempt (any two questions from section J and section II each.

3) Figures to the right indicate full 11larks.

4) Use of simple calculator is allowed.

Ql)   What do you understand by the terms “Budget and Budgetary control”?

What  are the advantages of budgetary control”?      [10]


Q2) “The emphasis of financial .accounting is different from that of Cost

Accounting.” Commen!.   [15

Q3) Explain- [15]

a) Idle time

b) Time keeping and time booking

c) Labour turn0ver.

Q4) What is marginal costing? Explain  a) PlY ratio.  b) Margin of safety

c) Break even point. [15]


Q5) Write short notes on (any three) : [15]

a) Dual aspect concept.

b) Management accounting.

c) Cost sheet.

d) Subsidiary books.

e) FIFO.


Q6)  Following is the Trial balance of Mr. Kumar for the year ended 31st March

2002. Prepare Final Accounts.     [15]

Trial Balance

Particulars                                         Debit


12 % Investments                                            35000

Stock as on 01 st April 2001                           30400

Purchases                                                       98700


Carriage Inward                                                2900

Carriage Outward                                             5600

Salary                                                              19600

Vehicle expenses                                               8400

Printing & Stationery                                         6870

Insurance on machinery                                    8420

Plant & Machinery                                           70000

Furniture & Fixtures                                       18000

Vehicles                                                           25000

Debtors                                                           36000




Commission received


Rent paid                                                         12000

Cash in hand                                                     2500

Bank balance                                                   24000

Interest on bank








Total                                         403390



a) Closing Stock is valued at Rs. 22420.

b) Depreciation provided @ 10% on Plant & Machinery, @ 5% on Vehicles

and @ 2.5% on Furniture & fixtures.

C) Provide 5% on Debtors for doubtful debts.

d) Outstanding salary is Rs. 4800. Investment are purchased on 01110/2001.


Q 7) Rahul and Sujatha have a unit each, for manufacturing cricket bats.

Details are  as under:       [15]



Rs. Lakhs

Rs. Lakhs





Variable costs



Fixed overhead



Rahul’s unit runs at 100% capacity and Sujatha’s at 60% capacity. They decide to merge the two units to form Kumar Brothers.

a) Calculate for the imiividual pre-merger status (i) P/V ratio (ii) BEP.

b) Calculate the post-merger (i) PN ratio (ii) BEP.

c) Find the profit of the merged firm at 75% capacity.


Q8) The standard mix of a product P is shown below: [15]


Raw Material         Units Rs.

x        30      @20 each

y        70      @30 each

Standard Loss is 10% of input.

Actual data

Raw Material  Units         Rs.

x              34       @ 18 each

y              66       @36 each


Actual Loss is 15% of input. Calculate material variances.

Q9)    Distinguish between: (Any three) [15]

a) Fixed budget and flexible budget.

b) Capital expenditure & revenue expenditure.

c) Trade discount & cash discount.

d) JouD1al & ledger.

e) Direct & indirect expenses.

MAY 2009


Management Accounting (New)

(2005 Pattern)


Time: 3 Hours}                                                                           [Max. Marks: 70

Illstructiolls to tlte candidates:

1)         Question No.1 is compulsory.

2)         Attempt any two questions from each section.

3)         Figures to tlte right indicate marks.

4)         Use of simple calculator is allowed.


QI) The expenses budgeted for production of 10,000 units in a factory are

furnished below:                                                                                       [10]


Rs. per unit

Material                                                        70

Labour                                                       25

Variable Overheads                                   20

Fixed overheads (Rs.I0,0000)                      10

Variable expenses (direct)                          05

Selling expenses (10% fixed)                      13

Distribution expenses (20% fixed)              07

Administration expenses (Rs.50,000)                   05


Total             155


Prepare a budget (flexible) for the production of 8000 units and 6000 units. Assume that administration expenses are rigid for all levels of production.


Q2) Explain the different methods of classification of overheads. [15]


Q3) What do you understand by budgetary control? What are the essentials for

the success of a budgetary control system.      [15]

Q4) How is marginal costing useful in the decision making of a fim1? [15]


Q5) Write short notes on : (any three) :         [15]

a) Material Price Variance.

b)          Materiality and Accural Concept.

c) Time Keeping.

d) Labour Turnover.

e) Items Excluded from Cost Sheet.



Q6) The accounts of L & T manufacturing company, Bombay submitted the

information from Costing Department. Find out –      [15]

a) Material Consumed.

b) Prime Cost.

c) Factory Overheads

d) Administrative overheads

e) Total Cost.


Drawing office salaries                                               13,000

Counting house salaries                                   25,200

Carriage and cartage outward                           8,600

Carriage on purchases                                                14,300

Bad debts                                                         13,000

Repairs of plant and machinery                         8,900

Rent, rates and insurance

Factory                      17,000

Office                         4,000


Sales                                                                9,22,200

Stock of materials

Opening                                                            1,25,600

Closing                                                               96,000

Material purchased                                           3,70,000

Traveling expenses                                               4,200

Traveler’s salaries and commission                               15,400

Productive wages                                              2,52;000


Office furniture                    6,000

Plant and machinery 13,000         →                   19,000

Director’s fees                                                     12,000

Gas and Water

Factory                                                                  2,400

Office                                                                           8,00

Manager’s salary

(factory 3/4 and office 1/4)                                  20,000

General expenses                                                  6,800

Income tax                                                             1,000

Dividend                                                                         2,000


Q7) The following miscellaneous information regarding the operations of 2005

has been made available from the records ofPankaj          [15]

Sales                                         Rs.I00,000

Direct materials used               RsAO,OOO

Direct labour                            Rs.15,000

A.xed manufacturing overheads          RS.20,000

Gross profit                              RS.20,000

Net loss                                    Rs.5,000

Fixed selling and administration expenses RS.1 0,000 there are no beginning or

ending inventories.

Calculate =

a)         Variable selling and administration expenses.

b)          Contribution margin in rupees.

c)          Variable factory overheads.

d) Break even point in rupees.

e) Factory cost of goods sold.

Q8) Prepare a cash budget for the quarter ended 30th sept’2007 based on the

following information.                                                                                       [15]

Cash at bank on 1 st July’ 2007 Rs.25,000 Salaries and wages estimated monthly

RS.1 0,000 Interest payable – August RS.5,000.

Particulars                      June            July             Aug              Sept

(Rs.)            (Rs.)            (Rs.)           (Rs.)

Estimated cash sales                                      1,40,000      1,52,000      1,21,000

Credit sales                       1,00,000      80,000         1,40,000      1,20,000

Purchases                         1,60,000      1,70,000      2,40,000      1,80,000

Other expenses                                    20,000         22,000         21,000

(Payable in same month)

Credit sales are collected 50% in the month of sales are made and 50% in the month

Following. Collection from credit sales are subject to 5% discount if payment is received

in the month of sales and 25%’in payment is received in the following month.

Creditors are paid either on prompt or 30 days basis. It is estimated that 10%

of the creditors are in the prompt category.


Q9) The standard quantity and standard price of raw material required for one

unit of product A are given as follows:                    [15]

Quantity                Standard Price

Material x         2kg                       Rs.3 per kg

Material y         4kg                       RS.2 per kg

The actual production and relevant data are as follows:

Output 500 units of Product A.

Material       Total quantity                  Total cost

for 500 units

x              1100 kg                           3410

y              1800 kg                           3960


Calculate variances.



Instructions to the candidate:

1) Question No.1 is compulsory.

2) Attempt any Two questions from section I and section II each.

3) Figures to the right indicate full marks.

4) Use of simple calculator is allowed.


Q. l) Identify typical users of financial reports and accounting information.




Q. 2) Define overheads. What are the causes of under and over absorption of

Factory overheads? How will you deal with them in cost accounts?                                                                                                                [I5]

Q3) What are the methods ~f pricing materials issues? When do you advocate

pricing the issues at cost price based on last in, first out?                    [I5]

Q. 4) Define and explain in brief                                                          [15]

a) Journal

b) Ledger

c) Management Accounting.


Q. 5) Write short notes on any three.                                                          [15]


a) Zero Base budgeting (ZBB)

b) Types of Assets.

c) Labour turnover

d) Accounting conventions.

e) Items to be excluded while preparing cost sheet.


Q6) The details regarding composition and the weekly wage rates of labour force engaged on a job scheduled to be completed in 30 weeks are as follows. [15]

Standard                                 Actual

Type of workers.      No of                weekly            No.of        weekly

workers           rate Rs.          workers   rate Rs.

Skilled                     75                    60                70               70

Semi – skilled           45                    40                30               50

Unskilled.                 60                   30                80               20


The work is actually completed in 32 workers. Calculate various labour vanances.

Q7) a) Fill in the blanks for each of the following independent situations. [10]


b)      Give Performa cost sheet.








i) Selling Price Per Unit

Rs. 50

Rs. 20

Rs. 30

ii) Variable costs as % of selling price




iii) No. of Units Sold





iv) Marginal contribution (Rs.)





v) Fixed costs (Rs.)




vi) Profit/Loss

Rs. 20,000

Rs. 30,000

Rs. 15,000


c)      Give proforma cost sheet.


Q. 8) a) For production of 10,000 electrical automatic irons the following are the

Budgeted expenses.                                                                        [15]

per unit (Rs)

Direct materials                                                  120

Direct Labour                                                      60

Variable overheads                                                       50

Fixed overheads (Rs. 1,50,000)                                     15

Variable expenses (direct)                                     10

Sell ing expenses ( 10% fixed)                                      30

Administration expenses (Rs. 100000)

rigid for all levels of production                             10

Distribution expenses (20% fixed)                          10

Total cost of sale p. u.                                               305


Prepare a budget for production of 6000, 7000 and 8000 irons, showing distinctly

marginal cost and total cost.

Q. 9) From the following balances extracted from the books of Mr. Amit prepare

trading & profit & loss Account for the year ended 31. 03. 2004 and a balance

sheet as on that date.


Stock on 1. 04. 2003                                                        10,000

Purchases less returns                                                    49,000

Wages                                                                              15,000

Loan from shri. Aman                                                      1,50,000

Capita                                                                                60,000

Sundry debtors                                                                  42,700

Reserve for bad debts (1.4.03)                                               2,800

Rent. & taxes                                                                       1,000

Salaries                                                                               8,000

General expenses                                                                   900                      Discount allowed                                                                   500

Sundry Creditors                                                               20,000

Sales 1,                                                                             28,600

Plant & machinery                                                          1,50,000

Furniture                                                                                  18,000

Cash                                                                                           2,300

Drawings                                                                                     6,000

Sales returns                                                                      2,000

Cost of lease on 1. 04. 03                                                           56,000



i) The closing stock was Rs. 9800.

ii) Write off 10% depreciation on plant and 5% on furniture.

iii) Write off bad debts Rs. 700 and maintain Reserve for bad debts at 6%.

on debtors.

iv) Write off Rs. 6000 in the current year from the cost of lease.                  [15]

MAY 2008


Instructions to tile candidates:

1) Q.l is compulsory.

2) Attempt any two questions from Section I and Section II each.

3) Figures to tile rigllt indicate full marks.

4)Use of simple calculator is allowed


Ql) Explain the various types of subsidiary books in brief and draw the specimen

of ‘Return Outward’ register.                                                                   [10]


Q2) Define Management Accounting. Discuss various functions carried out by

Management Accounting.                                                                        [ 15]

Q3) What is meant by overheads? How are they classified? What do you

understand by under or over absorbed overheads?                                   [15]

Q4) a) What is bank reconciliation statement? List the various causes of

disagreement between balances shown by Cash Book & Pass Book. [10]

b) Write short note on : Types of Accounts and rules of double entry. [5]

Q5) Write short notes on any three.                                                     [15]

a) Zero base budgeting

b) Cost reduction & cost control

c) Break even point

d) Errors not disclosed by trial balance

e) Time booking.


Q~) A manufacturer forecasts his expenses for a normal output of 8000 units representing 80% production capacity. His production in past years ranges from 7000 to 9000 units. He expects that the production will not fall outside this range during the ensuring budget period. Prepare a flexible budget for

10% varying levels of production from the given information.

Raw materials                Rs. 40,000

Direct wages                  Rs. 10,000

Factory overheads           Rs.20,000

(60% fixed)

Selling overheads

(80% fixed)

Show in the budget besides total cost, the unit variable cost, unit fixed cost

and unit total cost at different levels of production.                              [15]

Rs. 10,000

Q 7) From the following information, calculate variances.                         [15]









per kg













per kg





















Q8) The following figures are available from the records of Akshay Ltd as

on 31/31

2005               2006

Rs. Lacs            Rs. Lacs

Sales                                                       250                      200

Profit                                                        50                        30


a) P/V ratio

b) Fixed cost

c) The break even level of sales

d) The sales required to earn a profit of Rs. 90 lacs.

e) The .profit/loss that would arise if the sales were Rs. 280 lacs.                       [15]

Q9) From the following trial balance of Mr. Anish prepare Final Accounts as on

















Stock (1/04/06)






Insurance (paid for one year on 1/10/06)









Carriage inward



Carriage outward






Land & Building






Debtors & Creditors


















Rent received



Depreciation on machinery





Adjustments: ­

1. Closing stock is valued at Rs. 44,000. 2. Patents are revalued at Rs. 18,500 on 31/3/07. 3. Printing bill of Rs. 2,100, wages Rs. 3,200 & salaries Rs. 4,800 are


4. Goods of Rs. 15,000 were taken by Mr. Anish for his private use. No

entry was made in the books.

5. A part of the building was let out at Rs. 1,800 p.m. from 1/12/2006.         [15]

MAY 2007



1)       Question No.1 Compulsory.

2)       Attempt any two question from the section I and section II each.

3)       Figures to tne right indicate marks.

4)       Use of simple calculators is allowed.


Q1)    Explain any five basic concepts in Financial Accounting. (GAAP)




Q2)    Explain the importance of cost accounting as a managerial tool. How costs are classified?


Q3)    What is labour turnover? What are the causes of Labour turnover? How is it measured?


Q4)    Define standard cost and standard costing. Write the advantages and disadvantages of standard costing.                                                                                         [15]


Q5)    Write short Notes on (Any three)

a)                 Trial balance.

b)                  Functional budgets.

c)                  Cost Sheet.

d)                 Bank Reconciliation Statement.

e)                 LIFO.





Q6)    The budget production of Alfa ltd is 60000 units, the variable costs p.u. is Rs.16 and

fixed cost per unit is Rs. 4. Selling price is to be fixed to fetch a profit of 20% on cost.

i)                   Calculate BEP and P/V ratio at budgeted Selling Price.

ii)                 If the selling Price is reduced by 10% what will be BEP and P/V ratio?

iii)              Company desires 10% increase in budgeted Profit at revised selling price mentioned in (ii) above, calculate required sales volume in units and rupees.


Q7)    For Manufacturing 15 kg of a product, the standard material required are :

Materials     A:       12 kg @ Rs.10

B:      5 kg @ Rs.16

C:      3 kg @ Rs.20


In a Month, 1500kg of the product were produced. The actual material consumption was as follows:


Materials               A:       1100 Kg @ Rs.12

B:      600 kg @ Rs.14

C:      450 kg @ Rs.18


Calculate material variances.


Q8)    Prepare Trading & Profit & Loss Account And the Balance sheet as on 31.03.2005 of



Balances as On 31.03.2005


Capital of Mr. Ramesh                                                     50,000

Debtors                                                                           25,600

Creditors                                                                        28,000

Drawings                                                                        5,000

General Expenses                                                           1,500

Printing                                                                          1,300

Wages                                                                                      7,500

Royalty                                                                           2,500

Purchases                                                                       35,000

Sales                                                                              46,400

Salaries                                                                          4,000

Office Expenses                                                               2,200

Insurance                                                                       700

Rent                                                                               1,900

Opening Stock                                                                          12,000

Building                                                                          12,000

Machinery                                                                       20,000

B/R                                                                                4,200

Loans                                                                              10,000

B/P                                                                                 1,000



1)                 Closing Stock Rs.25000

2)                 Depreciate fixed assets by 10%.

3)                 Rs.450 due from a customer is no more recoverable.

4)                 Provide for doubtful debts on debtors @ 5%.                                                                                         [15]

Q9)    A Company Has prepared the budget for production of the only product manufactured by them as under:-


Rs. In Lacs.

Raw material                                                                                     2.52

Direct Labour                                                                                     .75

Direct expenses                                                                        .10

Work Overheads(60%Fixed)                                                                2.25

Admn. Overheads(80% Fixed)                                                    .40

Selling Overheads (50% Fixed)                                                  .20

The actual production during the period was only 60,000 units. Calculate the revised budget cost per unit.


MAY 2006



1)     Question No. 1 is compulsory.

2)     Attempt any two questions from Section I and II each.

3)     Figures to the right indicate full marks.

4)     Use of simple calculator is allowed.


Q-1) “Agreement of Trail Balance does not necessarily mean that accounts are

correct”. Comment.                                                                                                [10]


Q-2) What is meant by Management Accounting? Discuss its scope, nature,

advantages and disadvantages .  [15]


Q-3) What is meant by overheads? What are the different ways of classifying

overheads ? Explain underabsorption and overabsorption of overheads.       [15]


Q-4) What is bank reconciliation statement? What are the various causes of

disagreement between balances shown by cash book and pass book.              [15]

Q-5) Write short notes on: (any three)

i)  Time booking

ii)  Key factor

iii) Subsidiary books.

iv)                FIFO

v)                  Types of accounts and rules of double entry.                                          [15]




Q-6) The following data relate to a company.

Year ended                    Total Sales (Rs.)                     Total Cost (Rs.)

31 -3 -2003                        22,23,000                                19,83,600

31 -3 -2004                        24,51,000                                 21,43,200

Assuming stability in prices, with variable costs carefully controlled to

refle determined relationship and an unvarying figure for fixed costs,


i) The P/V ratio          ii) Fixed cost           iii) Fixed cost as % of sales

iv) BEPO and              v) Margin of safety for years 03 & 04.



Q-7) The standard lanour hours and rates of payment per article ‘A follows.


Hours       Rate                 Total

(Rs.)                       (Rs.)

Skilled labour                                 10                  30                             300

Semi-Skilled labour                         8                   15                             120

Uni-Skilled labour                          16                  10                             160




The actual production was 1000 Articles of ‘A’ for which the actual worked and rates are given below.

Hours           Rate              Toral


Skilled labour                        9000               Rs.40                     3,60,000

Semi-Skilled labour              8400                Rs.15                    1,26,000

Uni-Skilled labour               20,000              Rs.9                      1,80,000





Calculate labour cost variances.


Q-8) Prepare a cash budget for the quarter ended 30-9-04 . based on the

following information.                                                      lacs .

June                 July        Aug             Sept.

(Rs.)                 (Rs.)       (Rs.)             (Rs.)

Estimated cash sales                    _                    1.40          1.52             1.21

Credit sales                               1.00                    .80           1.40             1.21

Purchases                                  1.60                   1.70          2.40             1.80

Other expenses                           _                         .20            .22              .21

(Payable in the same month

Cash in hand on 1-07-04                               Rs. 25,000

Salaries and wages estimated monthly        Rs. 10,000

Interest payable in August 04 ,                      Rs.   5,000

Credit sales are collected 50% in the month of sales and 50%in the month following.

Collection from credit sales are subject to 5% discount if payment is received in the month of sales and 2.5% if payment is received in the following

month.  Creditors are paid either on a prompt or 30 days basis. It is estimated that 10% of the creditors are in prompt category.                                                                                                        [15]

Q-9) Distinguish between: (Any three)

i) FIFO v/s LIFO

ii) Fixed cost v/s variable cost

iii)              Time keeping v/s time booking

iv)                Journal v/s ledger

v)                  Std costing v/s Budgetory control.

MAY 2006 OLD



1)     Attempt any two question from each section.

2)     Answer to the both sections are to be written in one and the same answer book.

3)     Use of simple calculator is allowed.

4)     Figures to the right indicate full marks.



Q-1) Define Management Accounting Explain its functions in detail.              [15]


Q-2) Explain ‘standard costing’. Explain material cost variances and labour cost

variances with suitable illustrations.                                                           [15]


Q-3) a) What is idle time? What are the factors causes it? How can it be

controlled?                                                                                                   [8]

b) Explain the term labour turnover. What are the causes of labour

turnover?                                                                                                     [7]


Q-4) Write short notes : (Any Three)                                                                    [15]

a) Business entity concept in Accounting

b) Subsidiary books.

c) Break even point.

d) Principles of double entry.

e) Bank reconciliation statement.


Q-5) Rahul and Sujata have a unit each , for manufacturing cricket bats. Details are

as under :

Rahul                     Sujata

Rs. lacs                     Rs. lacs

Sales                                                                            300                          120

Variable costs                                                             220                            90

Fixed overhead                                                              40                           20


Rahul’s unit runs at 100% capacity and Sujata at 60% capacity. They decide to merge the two units to form Kumar Brothers.


i)       For the individual pre-merger status P/V ratio and BEP.

ii)     The post merger P/V ratio and BEP.

iii)   The profit for the merged firm at 75% capacity.

Q-6) Distinguish between a fixed budget and a flexible budget. What advantages if

any, has a flexible budget over an ordinary budget.                            [15

Q-7) The following direct costs were incurred on Job No.10

Material : Rs. 4,000

Wages :

Departments :

A – 120hrs @ Rs. 6per hour.

B –   80hrs @ Rs. 2per hour.

C –   40hrs @ Rs. 10per hour.

Estimated overheads :

Departments : A – Rs. 10,000 for 10,000 labour Hrs.

B – Rs. 6,000 for 3,000 labour Hrs.

C – Rs. 4,000 for 1,000 labour Hrs.

Fixed overheads : Estimated at Rs. 40,000 for 20,000 normal hours.

Calculate the cost of Job No. 10 and the price to be quoted for getting a profit of 25% on selling price.                                                                                                  [15]

Q-8) The following is the Trial Balance of Mr. Ram as at 31.3.04.

Particulars                                                                  Debit                   Credit

Rs.                       Rs.

Ram’s Capital                                                              –                          3,50,000

Ram’s Drawings                                                          44,450                 –

Opening stock                                                           2,00,000                 –

Bills receivable / payable                                             50,000                85,000

Purchases                                                                   2,75,000                 –

Sales                                                                              –                           4,00,000

Returns                                                                           5,000                      4,500

Plant and Machinery                                                1,00,000                 –

Loose tools                                                                     25,000                –

Patents                                                                           25,000                –

Debtors                                                                       1,25,000                –

Creditors                                                                                                   1,40,000

Bank                                                                               77,550                –

Salaries and wages                                                        30,000                –

Repairs                                                                             7,500                –

Insurance                                                                         3,000                –

Power & fuel                                                                   3,500                –

Printing & stationery                                                     2,000                –

Misc. Expenses                                                                6,500


9,79,500               9,75,500


Adjustments :

1)     Closing stock Rs. 1,50,000.

2)     Depreciate plant & machinery by 15% and patents by 25%.

3)     Provide for doubtful debts at 5% of debtors.

4)     Outstanding salaries & wages Rs. 3,500.

5)     Prepaid insurance Rs. 1,000.

Prepare Trading and profit and Loss Account for the year ended 31th March 2004 and a Balance Sheet as at 31 th March 2004.                                                     [15]




1)     Answer any 3 questions from Section I and 2 questions from Section II.

2)     All questions carry 14 marks each.

3)     Draw suitable diagrams wherever required.


Q-1) Define ‘Managerial Economics’ Describe its scope and practical significance.

Q-2 Explain fully the concept of ‘price elasticity of demand’.

Q-3) State and explain the Law of Variable Proportions.

Q-4) a) What is cost function? Explain the cost concepts-TC,AC,MC.

b) Describe the characteristics of profit as a factor reward.


Q-5) Show how a monopoly firm reaches it equilibrium in the short run with the help

of MR and MC curves.


Q-6) Why government declares support prices and administered prices?

Q-7 a) What is economic liberalization?

b) How consumer’s interest can be protected?

Q-8) Define GNP and NNP and discuss the methods and difficulties in national

income accounting.

Q-9) Write notes on any 2:

a) features of Oligopoly.

b) Justification for the use of cost-benefit-analysis.

c) Disinvestment in the public sector.

d) Consumption function.


APRIL 2012

Total No. of Questions : 9] [Total No. of Pages : 4
[4175] – 102
(2008 Pattern) (Sem. – I)
Time :3 Hours] [Max. Marks :70
Instructions to the candidates:-
1) Q.No. 1 is compulsory.
2) Attempt any two questions from each section.
3) Figures to the right indicate marks.
4) Use of simple calculator is allowed.

Q1) Explain the following terms : [5 × 2 = 10] a) Drawings.
b) Cost Concept.
c) Conservatism.
d) Money measurement.
e) Time keeping and Time booking.
Q2) What do you mean by ‘Management Accounting’? State its objectives and
limitations. Also distinguish between ‘Management Accounting’ and ‘Financial
Accounting’. [15] Q3) Explain step by step procedure of identifying the material in respect to
procurement, storing and issuing. [15] Q4) Discuss the classification of overheads with appropriate examples. Explain
the ‘Under absorption’ and ‘over absorption’. [15] Q5) Write short notes on : [3 × 5 = 15] a) Classification of Accounts.
b) Labour Turnover.
c) Advantages and disadvantages of Standard Costing.
SEAT No. :
[4175]-102 2
Q6) Prepare Trading and Profit & Loss Account and Balance Sheet from the
following information of M/s Ganesh & Co. [15] Trial Balance as on 31-03-2011

Particulars Debit Rs. Credit Rs.
Sales 3,00,000
Plant & Machinery 1,20,000
Rent, rates & Taxes 20,000
Sales return 30,000
Freight 4,000
Accounts receivable 70,000
Opening inventory 1,20,000
Purchases 2,30,000
Discount 5,000
Interest 5,000
Salaries 70,000
Cash in hand 5,000
Purchase return 10,000
Bank loan 1,50,000
Capital 1,81,500
Accounts payable 40,000
Bills payable 26,000
Legal charges 500
General expenses 8,000
Cash at bank 20,000
Total 7,07,500 7,07,500

Adjustments :
a) Closing stock on 31-03-2011 was valued at Rs. 1,20,000 but its market
value was Rs. 1,30,000
b) Interest on bank loan was outstanding of Rs. 7,000.
c) Depreciate plant & Machinery at 10%.
d) The owner of M/s Ganesh & Company has withdrawn the goods worth
Rs. 20,000 for personal purpose. The accountant has forgotten the said
entry while preparing Trial Balance.

Q7) Following is the data :
Raw material consumed Rs. 60,000
Direct labour charges Rs. 36,000
Machine hours worked 3,600
Machine hour rate Rs. 5
Administrative overheads 20% on works cost
Selling overheads Re. 1 per unit
Unit produced 10,000
Unit sold 9,000 at Rs. 20 per unit
You are required to prepare a cost sheet from the above and also indicate cost
and profit per unit. [15] Q8) Two businesses, P Ltd. and Q Ltd. sell the same type of product in the same
type of market. Their budgeted profit and loss accounts for the current year
ending March 31, are as under : [15] P Ltd. Q Ltd.
Sales Rs. 1,50,000 Rs. 1,50,000
(-) Variable cost Rs. 1,20,000 Rs. 1,00,000
Fixed cost Rs. 15,000 Rs. 35,000
————- Rs. 1,35,000 ————- Rs. 1,35,000
Net budgeted profit Rs. 15,000 Rs. 15,000
You are required to :
a) Calculate the break even points of each business; and
b) State which business is likely to earn greater profits in conditions of
i) heavy demand for the product,
ii) low demand for the product.
Q9) A company manufacturers two products, A and B. Forecast of the units to be
sold in the first seven months of the year is given below : [15] Month Product ‘A’ Product ‘B’
January 1,000 2,800
February 1,200 2,800
March 1,600 2,400
April 2,000 2,000
May 2,400 1,600
June 2,400 1,600
July 2,000 1,800
[4175]-102 3
it is anticipated that
a) there will be no work – in – process at the end of any month, and
b) finished units equal to half the sale for the next month will be in stock at
the end of each month (including the previous December).
Budgeted production and production costs for the whole year are as follows:
Product ‘A’ Product ‘B’
Product (Units) 22,000 24,000
Per unit direct material Rs. 12.50 Rs. 19
Per unit direct labour Rs. 4.50 Rs. 7
Total factory overhead Rs. 66,000 Rs. 96,000
Prepare for the six months period ending june,
i) production budget for each month, and
ii) a summarized production cost budget.