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.

    DECEMBER 2008


    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]

     OCTOBER 2006



    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.