M.B.A. DEGREE EXAMINATION, NOVEMBER 2017
Industry Integrated
ACCOUNTING FOR DECISION MAKING
(2017 onwards)
Time 2 Hours Maximum 50 Marks
Part A (10 x 1 10)
Answer the following questions.
Each right answer scores 1 mark; each wrong answer carries
0.25 marks.
1. Difference of cost, which occurs while considering
alternatives can be classified as
dependent cost independent cost
incremental cost differential cost
2. Costs such as book value of old machines are can
be a classified as an example of
salvages relevant
irrelevant depreciated cost
3. An example of qualitative factor is
employee morale cost of materials
cost of workers cost of marketing
4. Fourth step in decision making process is
linear correlation
making decisions
implement decisions
evaluate performance
Sub. Code
11
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5. Formal method of making choices, considering help of
quantitative and qualitative analysis is classified as
quantitative analysis
decision method
qualitative method
linearity method
6. Type of outcomes, which can never be measured in
numerical terms in books of accounts are classified as
expected factors recorded factors
qualitative factors quantitative factors
7. Decisions made by company, which products to
manufacture and sell and in what quantities out, of many
product lines are called
incremental decisions
outsource decisions
product mix decisions
in-source decisions
8. Production of goods or services that can be bought from
outside suppliers is classified as
idle sourcing sunk sourcing
outsourcing in-sourcing
9. Cost such as dispose value of an old machine is is
classified as
irrelevant depreciated cost
salvages relevant
10. Costs which are related to different functions of value
chain of company, such as marketing and manufacturing
costs are considered as
value costs
future function costs
business function costs
sunk function costs
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Part B x 5 25)
Answer any five questions.
11. Explain about corporate governance.
12. From the following balance sheets as on 31st December,
you are required to prepare a cash flow statement.
Liabilities 2004

2005

Assets 2004

2005

Share capital 1,00,000 1,50,000 Fixed assets 1,00,000 1,50,000
Profit loss a/c 50,000 80,000 Goodwill 50,000 40,000
General reserve 30,000 40,000 Inventories 50,000 80,000
16% bonds 50,000 60,000 Debtors 50,000 80,000
Sundry
creditors
30,000 40,000 Bills
receivable
10,000 20,000
Expenses O/S 10,000 15,000 Bank 10,000 15,000
2,70,000 3,85,000 2,70,000 3,85,000
13. Discuss about balanced score card.
14. The following are the balance sheets of PQR Ltd. for the
year 2000 and 2001. Prepare a fund flow statement for
the year 2001.
Balance Sheets (Rs. in Lacs)
Liabilities 2000

2001

Assets 2000

2001

Share capital 300 460 Fixed assets 630 690
General reserve 150 180 Investments 130 180
Profit loss a/c 30 65 Debtors 135 220
Term loans 210 150 Stock 180 220
Sundry creditors 80 100 Bank balance 5 15
Bank overdraft 250 300 Other advances 25 30
Other liabilities 85 100
1,105 1,355 1,105 1,355
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Additional information
Dividend has been proposed 25% of the share
capital. Additional capital of Rs. 160 lacs was
brought in during the year 2001 and is eligible for
dividend for the full. For 2001, the proposed
dividend is included in other liabilities.
Depreciation on fixed assets has been provided to
the extent of Rs.90 lacs.
15. List out the techniques of cost analysis.
16. Find out margin of safety given Actual sales Rs. 80,000
P/V ratio is Fixed cost Rs. 12,000.
17. Explain about short term decision making.
Part C x 15 15)
Case Study
18. analysis is a tool to examine the health of a
business with a view to make the financial results more
intelligible" Clarify this statement.
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