OU 2260 OU 2260
Code No. 1023
FACULTY OF MANAGEMENT
M.B.A. I Semester Examination, January 2016
Subject Financial Accounting and Analysis
Course No. 1.3
Time 3 hours Max. Marks 80
Note Answer all the questions.
Part A (10 X 2 20 Marks)
(Short Answer Type)
1 Write short notes on each of the following at one place
Business entity concept
Suspense Account
Capital and Revenue expenditure
Leverage ratios
Comparative statement analysis
Objectives of Accounting standards
Significance of HRA
EVA
Objectives of tax planning
Balanced Score Card
Part B X12 60 Marks)
(Essay Answer Type)
2 Discuss the need and significance of accounting concepts and conventions.
OR
From the following details, prepare a trial balance as on 31st December 2014.
Rs. Rs.
Building
Capital
Purchases
Sales
Returns
Investments
Cash in hand
Drawings
Returns
Rent
Creditors
Interest Payable
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5000
50000
90000
10000
8000
5200
6500
5000
1000
800
11000
200
600
Salary
Insurance
Debtors
Bills receivable
Bills payable
Stationery
Plant Machinery
Bank
Stock
Salary payable
Commission
Carriage
1500
400
15200
4800
4000
1000
11000
10000
25000
1200
600
3000
3 Explain the problems involved in measuring business income.
OR
..2
OU 2260 OU 2260
Code No. 1023
2
From the following details, prepare final accounts for the year ending
31-12-2014.
Rs. Rs.
Capital
Drawings
Furniture
Bank O.D.
Creditors
Premises
Opening stock
Debtors
Rent received
Purchases
35000
6000
2600
4200
13800
24000
20000
15000
1000
112000
Insurance
General expenses
Salaries
Commission
Carriage
Discount
Discount
Bad debts
Sales returns
Sales
2000
4000
12000
1600
2000
2000
2000
800
2000
150000
Adjustments Stock on 31.12.2014 Rs.20,000
Write off depreciation
Premises Rs.1000
Furniture Rs. 600
Make a reserve of on debtors for doubtful debts
Allow interest on capital at
Carry forward Rs.200 for unexpired insurance
4 Discuss the managerial uses and limitations of ratio analysis.
OR
Using the information, prepare a Balance Sheet of a company.
Sales Total assets ….. 3 Sales Fixed assets …… 5
Sales Current assets ….7.5 Sales Inventory ……. 20
Sales Debtors 15 Current ratio ………….. 2
Total assets Net worth 2.5 Debt Equity …………….. 1
5 Discuss the relative merits and demerits of Funds Flow and Cash Flow
analysis.
OR
From the following details, prepare Funds Flow Statement.
Liabilities 2013
Rs.
2014
Rs.
Assets 2013
Rs.
2014
Rs.
Equity capital
Preference capital
General reserve
P L A/c.
Creditors
Bills Payable
Proposed dividend
Provision for tax
300000
150000
40000
30000
55000
20000
42000
40000
400000
100000
70000
48000
83000
16000
50000
50000
Good will
Land Building
Plant
Debtors
Stock
Bills receivables
Cash
Bank
115000
200000
80000
160000
77000
20000
15000
10000
90000
170000
200000
200000
109000
30000
10000
8000
677000 817000 677000 817000
Additional information
Depreciation of Rs.10,000 and Rs.20,000 have been charged on Plant and
Land Buildings respectively.
ii) An interim dividend of Rs.20,000 has been paid; iii)Income tax of Rs.35000 has been paid.
6 Explain the significance of accounting standards in global accounting
environment.
OR
Discuss the relevance of IFRS and HRA.