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Management Control Systems Question Papers Pune University

MAY 2009

Instructions to the candidates:

1) Attempt any three questions/rom Q. 1 to Q. 5.

2) Q. NO.6 is compulsory.

3) Figures to the right indicate full marks.

Ql) Distinguish clearly between strategic planning, management control and task

    control with examples.                                                                             [18]

Q2) "A Sound Audit system strengthens management Control" critically examine

       this statement in respect of the financial audit, Cost Audit and Management

       Audit.                                                                                                   [18]

Q3) "Balance score card started as a performance measurement system but has

       ended up as a full fledged management control system". Explain with

       suitable examples.                                                                                [18]

Q4) Explain the various types of responsibility centre in detail.                     [18]

Q5) Write a short note on (any three) :                                                                   [18]

a) Goal congruence.

b) Just in time.

c) Budgeting for R & D ..

d) Control systems in service organisation.

e) Bench marking and total cost management.

Q6) a) A company fixes the inter divisional transfer prices for its product on the

          basis of cost plus estimated return on investment in its divisions. The

          relevent portion of the budget for division'  A' for year 2007-08 is given



          Fixed Assets                                      Rs.5, 00,000

          Current Assets (other than debtors)    Rs.3, 00,000

          Debtors                                    Rs.2, 00,000

          Annual fixed cost of division                Rs.8, 00,000

          Variable cost per unit of product         Rs.10


Budgeted volume of production per year (units) 4,00,000 desire return on investment 28%.

Youare require to determine transfer price for division 'A'.                            [10]

Division 'A' and 'B' are both considering an outlay on new investment projects.

Division 'A'

Division 'B'

Investment outlay



Net return on new}




Current ROI



The companies cost of capital is 13%. Should the project be accepted or rejected?                                                                                                   [6]


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