M.Com (Semester III) (CBCS) Examination Oct/Nov-2017
ADVANCED COSTING
Day Date: Thursday, 16-11-2017 Max. Marks: 70
Time: 10.30 AM to 01.00 PM
Instructions: All questions are compulsory.
Figures to the right indicate full marks.
Use of calculator is allowed.
Q.1 Choose the alternatives given below. 14
If Gross profit ratio is 33
1
3 gross profit is Rs. 1,50,000, then sales are

5,33,333 4,50,000
3,00,000 1,83,333
If fixed asset turnover is 4 times, sales are Rs.10,00,000, then fixed asset are

40,00,000 2,50,000
5,00,000 25,00,000
Total of current assets minus current liabilities
Net current assets
Working capital
Excess of current assets over current liabilities
All of these
At cost and ordering cost is minimum.
EOQ ROQ
Optimum order size All of these
Liquid assets stock and prepaid expenses.
Fixed assets Current assets
Total assets None of these
Proprietors fund plus long term loans
Net worth Capital employed
Owners equity Shareholders fund
If Sales are Rs.7.50,000, Purchases Rs.5,00,000, G.P. then Cost of
goods sold Rs.
1,50,000 4,00,000
6,00,000 1,00,000
Collection from debtors will present current ratio which is 2:1
Not affect Improve
Decline None of these
Proprietors fund is also termed as
Shareholders fund Net worth
Owners equity All of these
10) Current ratio shows of business.
Short term solvency Profitability
Liquidity Long term solvency
Page 2 of 3
SLR-CJ-27
11) If annual usage is 12,00,000 kg, EOQ 3,00,000 kg, then No. of orders to be
placed in a year are
5 4
3 2
12) If Maximum Rate of Consumption is 500 kg per week. Reorder period is 2-3
weeks, Reorder Quantity is 2000 kg, then Reorder level is
1000 2000
3500 1500
13) Acid test ratio is also called as
Liquid Quick
Liquidity All of these
14) If proprietors fund Rs.5,00,000, Reserves and surplus to share capital is
0.25, there were no fictitious assets and losses, then share capital is
1,00,000 2,00,000
3,00,000 4,00,000
Q.2 Write short answer. 14
Functions of Financial Management.
Interpretation of financial statements.
Q.3 Average inventory Rs.80,000, closing inventory is Rs.10000 less than
opening inventory, stock velocity is 4 times, calculate.
Cost of goods sold
Opening inventory
Closing inventory
Purchases
07
Monthly Usage 2,00,000 kg, ordering cost Rs.1,000 per order, Carrying cost
1 paisa per kg per month. Compute EOQ.
07
Q.4 Cash Balance on 01.04.2017 Rs.25,000 14
Month Sales Rs. Purchases Rs. Wages Rs. Expenses Rs.
Feb 2017 2,00,000 1,50,000 21,000 8,500
March 2017 3,00,000 2,00,000 24,000 10,000
April 2017 3,50,000 2,25,000 25,000 11,000
May 2017 4,00,000 2,60,000 30,000 15,000
June 2017 3,60,000 3,00,000 27,000 12,500
It is estimated that:
Cash sales are 25% of credit sales.
Period of credit allowed to customers 2 months and from suppliers 1
month.
Lag in payment of wages is ¼ month.
Lag in payment of expenses is ½ month.
You are require to prepare cash budget for 3 months ended 30.06.2017.
OR
State advantages and limitations of Ratio Analysis.
Page 3 of 3
SLR-CJ-27
Q.5 From the following information, prepare statement of Proprietors Fund with as
many details as possible.
Current Ratio 4.5
Liquid Ratio 3
Fixed assets to Net worth 0.75
Bank Overdraft Rs.25,000
Reserves and surplus to Share Capital 0.333
Working Capital Rs.7,00,000
There were no long loans and fictitious assets.
14
OR
Gross Profit Rs.2,50,000
Gross Profit Ratio 20%
Stock Velocity 2.4 months
Debtor's Velocity 73 days
Creditors Velocity 36.5 days
Fixed Assets Turnover Ratio 4 times
Capital Turnover Ratio 2.5 times
From the above information, you are require to compute the following
Sales
Cost of Goods Sold
Average Stock
Accounts Receivable
Accounts Payable
Fixed assets
Capital employed