CS/MHA/EVEN/SEM-2/MHA-205/2018-19 ‘Mauna Abt Kaiam Azad University of Technology, West Bengal MAULANA ABUL KALAM AZAD UNIVERSITY OF TECHNOLOGY, WEST BENGAL Paper Code : MHA-205 FINANCIAL MANAGEMENT-I Time Allotted : 3 Hours Full Marks : 70 The figures in the margin indicate full marks. Candidates are required to give their answers in their own words as far as practicable. GROUP -A ( Multiple Choice Type Questions ) 1. Choose the correct alternatives for any ten of the following : 10x1=10 i) ii) Financial accounting works within the framework of a) Accounting conventions b) Accounting concepts c) GAAP d) None of these. Average collection period of a service organisation is calculated in a) Days b) Months c) Weeks d) Quarterly. MT-33005-20005 [ Turn overCS/MHA/EVEN/SEM-2/MHA-205/2018-19 iii) iv) v) vi) vii) viii) ix) What is the type of ICICI bank account ? a) Artificial Personal account b) Accounts of persons c) Representative personal account da) None of these. Accrual system of accounting is considered only a) Current year's income b) Current year’s expense c) Current year's expense & losses d) Current year's income & expenses. Balance sheet is a/an a) Income statement b) Position statement c) Expenses statement da) None of these. The ideal current ratio of a Company is alin: b) seek eC) 2k q) a2 3. Golden rule is also called as a) American rule b) British rule c) ‘Indian rule © d) None of these. If totals of both sides of a trial balance are not same then what account should be written in deficit side ? a) Capital account b) Suspense account c) Cash account d) None of these. Ledger is the book of a) Final entry b) Secondary entry c) Primary entry d) Collaborative entry. MT-33005-20005 2CS/MHA/EVEN/SEM-2/MHA-205/2018-19 x) Interest expense is a) 50% deductible b) 75% deductible c) 100% deductible d) Not deductible. xi) Error of principle gets detected by the a) Trial balance b) Balance sheet c) Ledger account d) All of these. xii) Which of the following is prepared to maintain arithmetical accuracy of records ? a) Journal b) Ledger c) Trial Balance d) Balance Sheet. GROUP - B ( Short Answer Type Questions ) Answer any three of the following. 3x5=15 2. Explain the Golden Rule of Accountancy for different i types of accounts. 3. From the following list of balances, prepare a Trial Balance as on 31.3.2019. Rs. Rs. 1, | Opening Stock 18,000 | 13. | Plant and Machinery 7,500 Hee oe | Waeee 10,000 | 14. | Loose Tools 1,800 3. | Sales 1,20,000 | 15. | Lighting 2,300 4, | Bank Loan ee 16. | Creditors 8,000 | 5. | Coal and Coke 3,000 | 17. | Capital 40,000 6. | Purchases 75,000 | 18. | Miscellaneous Receipts 600 7. | Repairs 2,000 | 19. | Office Salaries 2,500 8. | Carriage 1,500 | 20. | Office Furniture 600 9. | Income Tax 1,500 | 21. | Patents 1,000 10. | Debtors 20,000 | 22. | Goodwill 15,000. 11. | Leasehold Premises 6,000 | 23. | Cash at Bank 5,100 12. | Cash in Hand 200 | 24. | Closing Stock 6,000 MT-33005-20005 3 [ Turn overCS/MHA/EVEN/SEM-2/MHA-205/2018-19 State the advantages of financial statement analysis. Give a brief note on Profit Maximization vs Goal Maximization. 6. From the following information calculate : a) Current Asset b) Current Liability ¢) Closing Stock. Working Capital Rs. 4,00,000 Current Ratio Sick Quick Ratio Ded GROUP - C (Long Answer Type Questions ) Answer any three of the following. 3x15=45 7. From the following balances of Mr. Mithun Das for the year ending 31.12.2017, prepare Trading Account, Profit & Loss Account and Balance Sheet. MT-33005-20005 Particulars Amount Amount (Dr.) (Cr.) Rs.) Rs.) Opening stock 20,000 Debtors ; 40,000 Furniture & Fixture 10,000 Plant & Machinery 40,000 Land & Building 60,000 Wages 24,000 Salaries 12,000 Rent & Taxes 5,000 Bad Debt 1,000 Continued...CS/MHA/EVEN/SEM-2/MHA-205/2018-19 Particulars ' Amount Amount (Dr.) (Cr.) (Rs.) Rs.) Travelling Expenses 1; 2,000 Purchases 1,50,000 Electric Charges 1,500 Telephone Charges 2,500 General expenses 100 Postage & Telegram 2,900 L Sales 2,75,000 Return outwards 1,000 Creditors 40,000 Capital 1,00,000 Return Inwards 1,000 Insurance premium 1,500 Cash in hand 500 Cash at bank 42,000 | Total 4,16,000 4,16,000 The following matters are to be taken into account : a) Closing stock value at Rs. 5,000 b) Outstanding liabilities for wages Rs. 1,000, Salaries Rs. 2,000. c) Depreciation @ 10% PA is to be provided on all the fixed assets except Land & Building. d) Provision for doubtful debts is to be made @ 5% on debtors. MT-33005-20005 5 { Turn overCS/MHA/EVEN/SEM-2/MHA-205/2018-19 8. Define financial statement. “Financial statements are like a mirror that reflect the health of an enterprise.” Discuss. What are the tools of financial analysis ? List out the limitations of financial analysis. 8+4+4+4 9. Following are the summarized balance sheet of a health care unit. Prepare a fund flow statement. Balance Sheet Liabilities 2014 2015 Assets 2014 ] 2015 Share Capital 5,00,000 6,00,000 | Fixed Assets 10,00,000 | 11,20,000 Reserves 1,50,000 1,80,000 | Less: Dep. (3,70,000) | (4,60,000) P&LA/c I 40,000 65,000 | Stock 2,40,000 |- 3,70,000 Debenture 3,00,000 2,50,000 | Book debts 2,50,000 2,30,000 Creditors 1,70,000 1,60,000 | Cash L 1,00,000 75,000 a i; Prov. for IT 60,000 80,000 ia = Total 12,20,000 | 13,385,000 12,20,000 | 13,35,000 10. From the following summarized Balance Sheet of ABC Ltd. as at 31.12.17 and 31.12.2018, make out : a) A statement showing the changes in working capital for the year ended on 31.12.18. MT-33005-20005 — 6CS/MHA/EVEN/SEM-2/MHA-205/2018-19 b) A statement showing sources and application of funds for the same period. = 2017 2018 bilith 1 Liabilities 2017 2018 Assets Equity share 3,50,000 | 5,50,000 | Goodwill 1,00,000 75,000 capital 9% Redeemable Land & Pref. shares Share Building 1,35,000 | — 1,00,000 capital 1,75,000 75,000 ——+__| General Reserve 1,00,000 | _1,20,000 | Plant 2,20,000 | 2,60,000 Capital Reserve as 35,000 | Less : Dep. 50,000 Profit & Loss A/e | 1,60,000| _1.75,000 1,90,000 | 2,10,000 of | se Proposed Dividend 35,000 50,000 Building 2,10,000 3,00,000 ‘| Bank Loan 1,00,000 | 1,10,000 | trade Investment 75,000 95,000 Sundry Creditors 90,000 | 1,05,000 | Sundry ie Debtors | 1,50,000 | _1,20,000 Provision for 85,000 | 95,000 | Stock 1,00,000 | 1,685,000 Taxation sh | =| | Cash in Hand 35,000 90,000 _ —+ Cash at Bank 70,000 | 1,40,000 Preliminary Expenses 30,000 20,000 Ee 10,95,000 | 13,15,000 10,95,000 | 13,15,000 Additional information 2 i) Profit on sale of a Piece of revalued land was transferred to capital reserve. li) During the year a sum of Rs. 15,000 was paid as interim dividend iii) During the year, a machine costing Rs. 25,000 (accumulated depreciation of Rs. 15,000) was sold for Rs. 14,000. MT-33005-20005 5+10 { Turn overCS/MHA/EVEN/SEM-2/MHA-205/2018-19 Ts: Write notes on any three of the following : 3x5 a) Errors not disclosed by Trial Balance b) Event and Transaction c) Separate Entity Concept d) Debt equity ratio GAAP. ae