No. of Printed Pages: 4 IBFW-023 I
B.Sc. FASmON MERCHANDISING AND RETAIL·MANAGEMENT (BSCFMRM) Term-End Examination 0020....:5 December,
.BFW-023 RNANCIAL MANAGEMENT
Time: 3 hours Maximum Marks: 70
Note: Attempt any seven questions. All questions carry equal marks.


1. Differentiate between fixed cost and variable cost. How do they help in determining break-even point? 10

2. A company is producing a certain type of circuit breakers. The fixed cost of land, building etc. is Rs.4,00,000. The variable cost is Rs.100 per unit production. If the sale price of the product is Rs.200 per unit, what should be the minimum production level? What is the firm's profit if the firm is operating at present so that production is 8000 units? 10

3. Define Financial Management. Explain briefly any four major roles of financial management. 10

4. The following data relate to the working of a factory at Furshatganj for the current year:

Capacity worked: 50%

Fixed Cost:

Salary: Rs. 8.40,000

Rent: Rs. 5,60,000

Depreciation: Rs. 7,00,000

Other administrative expo Rs. 8,00,000

Rs. 29,00,000

Variable Cost:

Materials: Rs. 24,00,000

Labour: Rs. 25,60,000

Other exp.: Rs. 3,80,000

Rs. 53,40,000

Possible sales at various levels of working are: Capacity Sales 60% Rs. 95,00,000 75% Rs. 1,15,00,000 90% Rs. 1,37,50,000 100% Rs. 1,52,50,000
Prepare a flexible budget and show the forecast of profit at 90% and 100% capacity operations. 10

5. What is Cash Budget? What are the objectives for preparing the Cash Budget Explain the motives for holding cash. 10


6. Prepare a cash budget for the months of April, May and June, when opening balance of cash on 1st April is Rs. 50,000.The data is given below:
Month Sale Purchase Wages Official Expenses

February 30,000 40,000 1,000 2000

March 50,000 30,000 2,000 3000

April 60,000 25,000 3,000 1000

May 70,000 35,000 2,500 1500

June 80,000 30,000 3,500 2000 50% purchase is on cash and remaining on one month credit. Lag in payment of official expenses is 1/2 month. Lag in payment of wages is one month. 50% sale is on cash and remaining is divided in two equal instalments and with the first one being Paid within one month of cash sale and the second one after two months of cash sale. Tax paid in June Rs. 5,000.

7. Prepare cost sheet. Find out profit and cost per unit from the following information:

Raw material consumed: Rs. 1,50,000

Productive wages Rs. 90,000

Office overheads: 10% of factory

Factory overheads Rs. 20,000

Selling overheads: 20% of office overheads

Units produced: 4000

Units sold: 3600

Selling price Rs. 100 per unit

8. Explain the cost sheet. Discuss the difference between cost account and financial account. 10

9. Describe the impact of online payment on financial management. 10

10. The following particulars for the last process are given: 10


Units Price

Transfer from the last process 4000 9000

Transfer to the finished stock from the
process 3240 -

Direct wages 200

Direct material used 3000


The factory overheads in the process are absorbed 400% of direct material. Normal loss is 20% of the units worked and the scrap value is
Rs. 5 per unit.

Prepare the following: Process Normal wastage (loss) Abnormal loss A/c