SUGGESTED SOLUTION IPCC MAY 2014 EXAM

SUGGESTED SOLUTION
I.P.C.C M A Y 2014 EX AM
CO ST ACCO UN TIN G & FIN AN CIAL M AN AG EM EN T
Prelims (Test Code - I M J 4 0 9 8)
(Date : 28 April, 2014)
Head Office : Shraddha, 3rd Floor, Near Chinai College, Andheri (E), Mumbai – 69.
Tel : (022) 26836666
1|Page
Ans. 1
(a) A
O
C
48,000 units
`45 per order
15% 1.20 `0.18 per unit p.a.
1. EOQ
4,899 units
2.
i.
Re-order Level
ii. Maximum Level
Safety stock
500
Re-order level
2,420
4,899
iii. Minimum Level
Re-order Level
2,420
iv. Average inventory
Minimum level
500
(Normal consumption Normal Delivery time)
500 1,920 2,420 units
Re-order Quantity – (Minimum Consumption
Minimum Period)
5,399 units
(Normal Consumption
500 units
Normal Period)
EOQ :
4,899 2,950 units
(b)
Particulars
A
B
C
D
Statement for actual cost and standard cost for material:
Standard
Revised
Actual
Units Rate Amount Units Rate Amount Units Rate Amount
(`)
(`)
(`)
400
4
1,600
600
4
2,400
550
5
2,750
100
5
500
150
5
750
200
6
1,200
200
2.5
500
300
2.5
750
350
2
700
300
6
1,800
450
6
2,700
400
5
2,000
1,000
4,400 1,500
6,600 1,500
6,650
Calculation of Material variance:
Material cost variance Standard cost Actual cost
6,600 6,650
50(Adverse)
1. Material usage variance R (SQ AQ)
2. Material price variance AQ (SR AR)
A
A
200F
550(A)
4 (600 550)
550 (4 5)
B
B
250(A)
200(A)
5 (150 200)
200 (5 6)
C
C
125(A)
175F
2.5 (300 350)
350 (2.5 2)
D
D
300F
400F
6 (450 400)
400 (6 5)
125F
175(A)
Statement for actual cost and standard cost for labour:
Particulars
Standard
Revised
Hours Rate Amount Hours Rate Amount Hours
`
`
P
20
10
200
30
10
300
32
Q
10
8
80
15
8
120
14
R
15
12
180
22.5
12
270
20
S
7
20
140
10.5
20
210
10
52
600
78
900
76
Actual
Rate Amount
`
11
352
9
126
11
220
18
180
878
Calculation of Material variance:
Standard cost Actual cost
900 878
22 Favourable
3. Labour rate variance AH (SR AR) 4. Labour efficiency variance SR (SH AH)
P
P
32(A)
20(A)
32 (10 11)
10 (30 32)
Q
Q
14(A)
8F
14 (8 9)
8 (15 14)
R
R
20F
30F
20 (12 11)
12 (22.5 20)
S
S
20F
10F
10 (20 18)
20 (10.5 10)
6(A)
28F
Labour cost variance
2|Page
Reconciliation statement for variances:
Standard cost of material
Less: Material usage variance
Add: Material price variance
Actual cost of material
Standard cost of labour
Less: Labour efficiency variance
Add: Labour rate variance
Actual cost variance
6600
(125)
175
6650
900
(28)
6
878
(c)
1. Current weighted cost of capital
Cost of debt
Cost of Equity
dividend growth model:
Capital Structure
Equity and Reserves
14% Debentures
Weighted Average Cost of Capital
Amount
Weights
(`)
12 crores
0.8
3 crores
0.2
15 crores
1.0
Cost of WACC
capital
7.5%
6.0
7.0%
1.4
7.4
2. Weighted average Cost of Capital with additional loan:
Cost of existing debenture as per (1) 7%
Cost of debt
Cost of capital,
Source
(1)
Equity
16% Loan
14% Debenture
Weighted Average Cost of Capital with additional loan
Weights
After-tax Cost
Weighted Cost
Amount (`in crore)
(2)
(3)
(4)
(5) (3) (4)
12
0.60
9%
5.4%
5
0.25
8%
2.0%
3
0.15
7%
1.05%
20
1.00
8.45%
(d)
Particulars
Sales
Less: Cost of sales
Gross profit
Gross profit rate
Current stock: (75% `7,00,000) 5
Proposed stock: (75% `1,60,000) 4
Projected total stock
Projected stock turnover ratio
(75% `8,60,000) `1,35,000 4.78
Current debtors (`10,00,000 12)
Proposed debtors (`2,00,000 6)
Total debtors
Debtors collection period
360
360 35 days approx
Current (`) Proposed (`) Projected (`)
10,00,000
2,00,000
12,00,000
7,00,000
1,60,000
8,60,000
3,00,000
40,000
3,40,000
30%
20%
28.33%
1,05,000
30,000
1,35,000
83,333
33,333
1,16,666
3|Page
Ans. 2
(a)
i.
Schedule of Changes in the Working Capital
Particulars
31st March
A. Current Assets
Stock
Sundry Debtors
Bills Receivables
Cash in Hand & Bank
Total (A)
B. Current Liabilities
Sundry Creditors
Bills Payable
Total (B)
C. Working Capital (A B)
D. Increase in Working Capital
2013 (`)
2014 (`)
8.60
10.20
1.00
7.20
27.00
12.70
13.00
0.70
8.90
35.3
3.50
2.00
5.5
21.5
7.4
28.9
4.60
1.80
6.4
28.9
Changes in Working Capital
(in lakhs)
Increase (`) Decrease (`)
28.9
4.10
2.80
0.30
1.70
1.10
0.20
8.8
7.4
8.8
ii. Preparation of Funds Flow Statement
Funds Flow Statement as on 31st March 2014
Sources of Fund
(`) Application of Fund
Funds from Operation
26.15 Increase in Working Capital
Dividend on Investment
0.40 Tax paid
.Sale of Machinery
1.50 Interim Dividend
Issue of Shares
5.00 Dividend
Sale of Land
4.00 Purchase of Investments
Purchase of Plant
37.05
Working Notes:
Dr.
Particulars
To Balance b/d
To Bank (Purchase)
(Balancing figure)
Dr.
Particulars
To Balance c/d
To Bank A/c
Dr.
Particulars
To Balance b/d
To Bank (purchase b/d)
Plant & Machinery A/c
(`) Particulars
22.00 By Depreciation
13.70 By Bank (Sale)
By Loss on Sale
By Balance c/d
35.70
Provision for Taxation A/c
(`) Particulars
5.00 By Balance b/d
3.80 By P&L A/c (balancing figure)
8.80
Investment A/c
(`) Particulars
2.00 By Dividend A/c
1.65 By Balance c/d
3.65
Dr.
Land & Building A/c
Particulars
(`) Particulars
To Balance b/d
20.00 By Bank A/c (Sale)
To Capital Reserve (Profit on Sale)
2.50 By Depreciation
By Balance c/d
22.50
(`)
7.40
3.80
2.50
8.00
1.65
13.70
37.05
Cr.
(`)
3.00
1.50
0.20
31.00
35.70
Cr.
(`)
4.00
4.80
8.80
Cr.
(`)
0.15
3.50
3.65
Cr.
(`)
4.00
0.50
18.00
22.50
4|Page
Dr.
Adjusted Profit & Loss A/c
Particulars
(`) Particulars
To Depreciation on:
By Net Profit for 2013
Plant & Machinery
3.00 By Dividend on Investment
Land & Building
0.50 By Funds from Operation
To Loss on Sale of Machinery
0.20
To Goodwill Written Off
0.80
To Share Issue Up Written Off
0.20
To Provision for Taxation
4.80
To Transfer to General Reserves
2.00
To Interim Dividend
2.50
To Proposed Dividend
11.00
To Net Profit for 2014
6.70
31.70
Cr.
(`)
5.30
0.25
26.15
31.70
(Note: Schedule of changes in the working capital may be computed alternatively by taking
provision for tax as a current liability.)
(b)
1. Calculation of Operating Leverage
Particulars
Situation I
(`)
90,000
45,000
45,000
15,000
30,000
1.5
Sales (3,000 units @ `30 per unit)
Less: Variable cost (3,000 units @ `15 per unit)
Contribution
Less: Fixed Costs
Operating Profit (EBIT)
Operating Leverage
Situation II
(`)
90,000
45,000
45,000
20,000
25,000
1.8
2. Calculation of Financial Leverage
Financial Plan
Situation I
1
2
(`)
(`)
30,000
30,000
2,000
1,000
28,000
29,000
Operating Profit
Less: Interest on Debt
Profit before tax (PBT)
Financial leverage
1.07
3. Calculation of Combined Leverage
1.5
1.5
1.09
1.04
Operating leverage Ffinancial leverage
Situation I
1
1.07 1.6
1.04
Situation II
1
2
(`)
(`)
25,000
25,000
2,000
1,000
23,000
24,000
2
1.04 1.56
1.8
Situation II
1
2
1.09 1.96
1.8 1.04 1.87
Ans. 3
(a)
Particulars
To Units introduced
To Materials
Quantity
25,000
Process I Account
Amount Particulars
Quantity
(`)
2,00,000 By Normal Wastage @
2,500
`9.90
1,92,000 By Abnormal Loss @
500
Amount
(`)
24,750
16,250
5|Page
`32.50
2,24,000 By Process II account
@ `32.50
1,40,000
To Direct Labour
To Manufacturing
Expenses
25,000
7,56,000
Abnormal loss
Input unit
Less: Normal loss
25,000 7,56,000
Units
25,000
2,500
22,500
Cost (`)
7,56,000
24,740
7,31,250
` 32.50 per units
Cost per unit
Abnormal loss
22,000 7,15,000
500 units
Particulars
To Process I A/c
`32.50
Quantity
500
500
Particulars
To process I @
32.50
To Materials
To Direct labour
To Manufacturing
Expenses
To Abnormal
[email protected]
Quantity
22,000
200
`16,250.
Abnormal Loss A/c
Amount Particulars
(`)
16,250 By Bank
By Costing P & L A/c
16,250
Process II Account
Amount Particulars
(`)
7,15,000 By Normal Loss @
`8.60
96,020 By Finished stock @
`49.50
1,28,000
60,000
Unit
To Process I @ `9.90
2,500
To Process II @ `8.60
2,200
4,700
Particulars
To Normal Loss
To Costing P & L A/c
500
Amount
(`)
4,950
11,300
16,250
Quantity
Amount (`)
2,200
18,920
20,000
9,90,000
22,200
10,08,920
Unit
200
Amount
(`)
1,720
2,500
24,750
2,000
17,200
4,700
43,670
Quantity
200
Amount
(`)
9,900
200
9,900
500
9,900
22,200 10,08,920
Particulars
Quantity
Normal loss A/c
Amount Particulars
(`)
24,750 By Abnormal
effectiveness A/c @
`8.60
18,920 By Sales A/c - I @
`9.90
By Sales A/c II @
`8.60
43,670
Abnormal Effectiveness A/c
Quantity
Amount Particulars
(`)
200
1,720 By Process II A/c
8,180
200
9,900
6|Page
(b)
Allowed output 60 8 480
Normal rate per unit per hour
Statement showing the earnings of workers as per Taylor system
Particular
Ram
Rahim
Shyam
Effective rate
390
81.25%
450
93.75%
600
125%
Effective rate
Earnings
0.09 83% 0.747
390 0.0747 29.13
0.09 83%
450 0.747
0.0747
33.62
0.09 125%
600 0.1125
0.1125
67.5
Statement showing the earning of workers as per Merrick system
Particular
Ram
Rahim
Shyam
Effective Rate
81.25%
600
125%
93.75%
Effective rate
Earning
0.09 100% 0.09
390 0.09 35.10
0.09
450
110% 0.099
.099 44.55
0.09 120% 0.108
600 0.108 64.8
Ans. 4
(a)
Statement Showing estimated working Capital Requirement (cash cost basis)
A. Current Assets:
Raw Material
75,000
9,00,000
Finished hoods
27,00,000
Sales promotion
1,50,000
2,25,000
37,500
Debtors:Domestic
20,60,000
1,71,667
Export
10,30,000
2,57,500
Cash:
2,50,000 75,000
Total (A)
1,75,000
9,41,667
B. Current Liabilities:
Wages
7,20,000
30,000
Miscellaneous Expenses. 10,80,000
90,000
Administrative Expenses
2,40,000
20,000
Income Tax
2,25,000
56,250
Overdraft
Creditors
Nil
9,00,000
Total (b)
Net working capital A – B
Add: Margin for contingencies @ 12%
Total W.C.
W.N. 1
Calculation of Cash cost of production:
Raw material
Wages
Miscellaneous expenses
Cash cost of Production
1,50,000
3,46,250
5,95,417
71,450
6,66,867
9,00,000
7,20,000
10,80,000
27,00,000
7|Page
Calculation of Cash cost of sales:
Cost of Production
Add: Administrative Expenses
Sales Promotion Expenses
Cash cost of sales
27,00,000
2,40,000
1,50,000
30,90,000
W.N. 2
Calculation of Cash cost of Debtors:
Export sales 10,80,000 (10% below domestic sales price)
Export sales equivalent to Domestic sales:-10,80,000
12,00,000
W.N. 3
Apportionment of cash cost of sales between Domestic foreign Debtors:
Domestic Debtors 30,90,000
20,60,000
Foreign Debtors
30,90,000
10,30,000
(b)
Raw material
Processing wages
Processing overhead
Ratio
Process A/c
17,250
A: 16,000
16,240
B: 200
16,240
C: 2,000
D: 360
50,000
16,000 4
200 28
2,000 28
64,000
5,600
56,000
1. Statement showing apportionment of joint product
Particulars
Total
Ratio
A
Common cost
50,000 80:7:20:18
32,000
2. Statement showing product wise and total profit
Particulars
Total
Ratio
A
Units
16,000
`
Sales value
- 1,09,600
Less: Joint cost
32,000
Less: Further
28,800
processing Cost
48,800
360 40
14,400
B
2,800
C
8,000
D
7,200
B
200
`
5,600
2,800
-
C
2,000
`
30,000
8,000
16,000
D
360
`
21,600
7,200
6,600
2,800
6,000
7,800
3. Statement of profit if all the product is sold at split up point
Particulars
A
B
Sales value
64,000
5,600
Less: Joint cost
32,000
2,800
32,000
2,800
C
16,000
8,000
8,000
D
14,400
7,200
7,200
4. Comment:
i. A, Should be further processed
ii. B, No comment required
iii. C, Should not be further processed
iv. D, should be further processed
Ans. 5
(a)
Memorandum Reconciliation Account
Amount Particulars
(`)
To Net Loss as per Costing Books
3,47,000 By Administration overheads over
Particulars
Amount
(`)
60,000
8|Page
To Factory overheads underAbsorbed in Cost Accounts
To Depreciation under charged
40,000
In Cost Accounts
50,000
To Income-Tax not provided in
Cost Accounts
To Interest on Loan Funds in
Financial Accounts
54,000
2,45,000
Recovered in cost accounts
By Interest on investment not
Included in Cost Accounts
By Transfer fees in Financial
books
By Stores adjustment
(Credit in Financial books)
By Dividend received in Financial
Books
By Net Loss as per Financial
books
7,36,000
96,000
24,000
14,000
32,000
5,10,000
7,36,000
(b) Meaning: Bin cards are quantitative records of stores showing quantities received, issued to
production, and balance stock available. These are kept attached to the bins or receptacles so
that these assist in the identification of stock. They are also known as Cardex, Tag Card, etc.
Maintenance of bin card system is a part of the perpetual accounting system.
Advantages
1. There would be fewer chances of mistakes being made as entries will be made at the same
time as goods are received or issued by the person actually handling the materials.
2. Control over stock will be more effective, in as much as comparison of the actual quantity in
hand at any time with the book balance is possible.
3. Easy identification of different items of materials is facilitated.
Disadvantages
1. The stores records are dispersed over a wide area.
2. The cards are liable to be smeared with dirt and grease because of handling and proximity to
material.
3. People handling materials are not ordinarily suitable for the clerical work involved in writing
bin cards.
(c) NOI means earnings before interest and tax. According to this approach, capital structure
decisions of the firm are irrelevant.
Any change in the leverage will not lead to any change in the total value of the firm and the
market price of shares, as the overall cost of capital is independent of the degree of leverage.
As a result, the division between debt and equity is irrelevant.
As per this approach, an increase in the use of debt which is apparently cheaper is offset by an
increase in the equity capitalization rate. This happens because equity investors seek higher
compensation as they are opposed to greater risk due to the existence of fixed return securities
in the capital structure.
The above diagram shows that
(Overall capitalization rate) and
(Cost of equity) increases with leverage.
are constant
(debt capitalization rate)
9|Page
(d) The venture capital financing refers to financing of new high risky venture promoted by qualified
entrepreneurs who lack experience and funds to give shape to their ideas.
i. Equity Financing
ii. Conditional loan
iii. Income Note
iv. Participating Debentures
Ans. 6
(a)
Particulars
Statement showing evolution of proposal – l
Time
PVF
Amount
Cash outflows
Building
Plant
Installation
Working Capital
Present value of cash outflows (a)
Cash Inflows
Pre Depreciation Profit
Terminal Value
Plant
Working Capital
Building
Present value of cash inflows (b)
Net present value (b a)
Particulars
0
0
0
0
1
1
1
1
50,000
2,00,000
10,000
50,000
50,000
2,00,000
10,000
50,000
3,10,000
1-10
6.71
70,000
4,69,700
10
10
10
0.463
0.463
0.463
10,000
50,000
30,000
4,630
23,150
13,890
5,11,370
2,01,370
Statement Showing Evaluation of Proposal – ll
Time
PVF
Amount
Cash outflows
Building
Plant
Installation
Working Capital
Present value of cash outflows (a)
Cash Inflows
Pre Depreciation Profit
Present
Value
0
0
0
0
1
1
1
1
1,00,000
3,00,000
15,000
65,000
1,00,000
3,00,000
15,000
65,000
4,80,000
1
2
3-10
0.926
0.857
4.927
95,000
80,000
95,000
87,970
68,560
4,68,060
0.463
0.463
15,000
65,000
80,000
60,000
Terminal Value
Plant
Working Capital
Building
Present value of cash inflows (b)
Net present value (b a)
Present
Value
10
10
37,040
27,780
6,89,410
2,09,410
(b)
Computation of Bus Fare to be charged from per Passenger per km
Particulars
Garage rent per month
Repairs and maintenance per month
Salaries of 5 drivers (3,000 5) per month
Wages of 5 conductors (1200 5) month
Managers salary per month
Road tax, permit fee etc month
Office Expenses per month
`
4,000
9,375
15,000
6,000
7,500
1,667
2,000
10 | P a g e
Diesel
1,65,000
(WN1)
Depreciation per month (`6, 50,000
Insurance per month (`6,50,000
Total Cost per month
Profit (2,59,292
)
Total Takings
Passenger kms (WN 2)
Taking per passenger per km
5
5
40,625
15%)
3%
8,125
)
2,59,292
1,29,646
3,88,938
9,60,000
`0.405
Working Notes:
1. Calculation of total traveling of 5 buses per month:
No. of round trips daily
3
Distance one way
40 kms
No. of days run in a month
25 days
No. of buses
5
Total Traveling per month
3 2 40 25 5 30,000 kms.
2. Calculation of passenger kms per month:
No. of kms traveled per month
30,000
Capacity occupied
40 passengers 80% 32
No. of passenger kms
30,000 32 9,60,000
Ans. 7
(a) Advantages
1. The contract is assured of a fixed percentage of profit. There is no risk of incurring any loss
on the contract.
2. It is useful especially when the work to be done is not definitely fixed at the time of making
the estimate. Contractee can ensure himself or herself about the cost of the contract as he
or she is empowered to examine the books and documents of the cost of the contract.
Disadvantages
1. Since contractor is assured of a profit margin, there may not be any incentive for cost
reduction by avoiding wastage and effecting economics in production.
2. The customer has to pay not only the resultant high cost but also the resultant high profit and
thus, customer may have to pay substantially for lack of proper attitude (towards cost and
efficiency) on the part of contractor. The final price to be paid by customer cannot be exactly
ascertained up to the last and may create difficulty for the customer in preparing purchase
budget.
(b)
Fixed Budget
1. It does not change with actual volume of
activity achieved. Thus it is known as rigid
or inflexible budget
2. It operates on one level of activity and
under one set of conditions. It assumes
that there will be no change in the
prevailing conditions, which is unrealistic.
3. Here as all costs like - fixed, variable and
semi-variable are related to only one level
of activity so variance analysis does not
give useful information.
4. If the budgeted and actual activity levels
differ significantly, then the aspects like
cost ascertainment and price fixation do
not give a correct picture.
5. Comparison of actual performance with
budgeted targets will be meaningless
specially when there is a difference
between the two activity levels.
Flexible Budget
1. It can be recasted on the basis of activity
level to be achieved. Thus it is not rigid.
2. It consists of various budgets for different
levels of activity
3. Here analysis of variance provides useful
information as each cost is analysed
according to its behaviour.
4. Flexible budgeting at different levels of
activity, facilitates the ascertainment of
cost, fixation of selling price and tendering
of quotations.
5. It provides a meaningful basis of
comparison of the actual performance with
the budgeted targets.
11 | P a g e
(c) A variety of methods can be used by managers to cope with risk and uncertainty to apply CVP
analysis. Some of them are following:
1. Management must realise the uncertain nature of future prices, cost and quantities.
2. Managers should move away from consideration of break-even point to what might be called
a break-even band.
3. Managers may engage in sensitivity or what – if analysis.
4. Normal probability distribution can be used to estimate the risk.
5. Two concepts useful to management are margin of safety and operating leverage. Both
the concepts are considered as measures of risk
(d) ECBs refer to commercial loans(in the form of bank loans, buyers credit, suppliers credit,
securitized instruments (e.g. floating rate notes and fixed rate bonds) availed from non resident
lenders with minimum average maturity of 3 years. Borrowers can raise ECBs through
internationally recognized sources like (i) international banks, (ii) international capital markets
(iii) multilateral financial institutions such as the IFC, ADB etc, (iv) export credit agencies (v)
suppliers of equipment, (vi) foreign collaborators and (vii) foreign equity holders.
External Commercial Borrowings can be accessed under two routes viz (i) Automatic route (ii)
Approval route. Under the Automatic route there is no need to take the RBI/ Government
approval whereas such approval is necessary under the Approval route. Company's registered
under the Companies Act and NGOs engaged in micro finance activities are eligible for the
Automatic Route where as Financial Institutions and Banks dealing exclusively in infrastructure
or export finance and the ones which had participated in the textile and steel sector restructuring
packages as approved by the government are required to take the Approval Route.
(e) Some of the items/ factors which need to be considered while planning for working capital
requirement are:Cash: Identify the cash balance which allows for uninterrupted production but reduces the
investment in raw materials and hence increases cash flow; the techniques like Just in Time
(JIT) and Economic order quantity (EOQ) is used for this.
Debtors: Identify the appropriate credit policy, i.e., credit terms which will attract customers,
such that any impact on cash flows and the cash conversion cycle will be offset by increased
revenue and hence Return on Capital (or vice versa). The tools like Discounts and allowances
are used for this.
Short term financing options: Inventory is ideally financed by credit grant by the supplier;
dependent on the cash conversion cycle, it may however, be necessary to utilize a bank loan (or
overdraft), or to "convert debtors to cash" through "factoring" in order to finance working capital
requirements.
Nature of Business: For e.g. if an item demand far exceeds its production, the working capital
requirement would be less as investment in finished goods inventory would be very less.
Technology and manufacturing Policies: For e.g. in some businesses the demand for goods
is seasonal, in that case a business may follow a policy for steady production through out over
the whole year or instead may choose policy of production only during the demand season.
Operating efficiency: A company can reduce the working capital requirement by eliminating
waste, improving coordination etc.
Price Level Changes: For e.g. rising prices necessitate the use of more funds for maintaining
an existing level of activity. For the same level of current assets, higher cash outlays are
required. Therefore the effect of rising prices is that a higher amount of working capital is
required.
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MARKS ALLOCATION SHEET
Que
. No.
Name of Chapter
Description of Concept
1(a)
1(a)
1(a)
1(a)
1(a)
1(b)
1(b)
1(b)
1(b)
1(b)
1(c)
1(c)
Sub point
No.(if
any)
-
Material costing
Material costing
Material costing
Material costing
Material costing
Standard costing
Standard costing
Standard costing
Standard costing
Standard costing
Cost of capital
Cost of capital
1(d)
1(d)
-
Ratio Analysis
Ratio Analysis
1(d)
1(d)
2(a)
-
Ratio Analysis
Ratio Analysis
Fund flow statement
2(a)
2(a)
2(a)
2(a)
2(a)
2(a)
2(b)
2(b)
2(b)
3(a)
3(a)
3(a)
3(a)
3(a)
3(a)
-
Fund flow statement
Fund flow statement
Fund flow statement
Fund flow statement
Fund flow statement
Fund flow statement
Leverage
Leverage
Leverage
Process Account
Process Account
Process Account
Process Account
Process Account
Process Account
3(b)
-
Labour costing
3(b)
-
Labour costing
4(a)
-
4(a)
-
4(a)
-
4(a)
-
4(a)
-
4(a)
-
Working capital
management
Working capital
management
Working capital
management
Working capital
management
Working capital
management
Working capital
Calculation of EOQ
Calculation of Re-order level
Calculation of Maximum level
Calculation of Minimum level
Calculation of Average inventory
Calculation of material price variances
Calculation of material usages variances
Calculation of labour rate variances
Calculation of labour efficiency
Preparation of reconciliation statement
Calculation of weighted cost of capital
Calculation of cost of capital with
additional loan
Calculation of projected total stock
Calculation of projected stock turnover
ratio
Calculation of total debtors
Calculation of debt collection period
Scheduled of changes in the working
capital
Preparation of plant & machinery A/c
Preparation of Provision for tax A/c
Preparation of investment A/c
Preparation of land & building A/c
Preparation of adjusted P/L A/c
Preparation of fund flow statement
Calculation of operating leverage
Calculation of financial leverage
Calculation of combined leverage
Preparation of Process – I A/c
Calculation of abnormal loss A/c
Preparation of Abnormal loss A/c
Preparation of Process – II A/c
Preparation of normal loss A/c
Preparation of abnormal effectiveness
A/c
Statement showing the earning as per
Taylor System
Statement showing the earning as per
Merrick system
Calculation of current assets
Mark
Allocation
1
1
1
1
1
1
1
1
1
1
2.5
2.5
Total
Marks
5
5
5
2
1
1
1
1.5
1
1
1
1
1.5
3
2
2
2
2
1
2
2
2
1
5
10
6
10
3
3
6
2
Calculation of current liabilities
2
Calculation of cash of production
0.5
Calculation of cash of cost of sales
0.5
Calculation of cash cost of debtors
1
Calculation of apportionment
1
13 | P a g e
4(a)
-
4(b)
-
4(b)
-
4(b)
-
4(b)
-
4(b)
-
5(a)
-
5(b)
5(b)
5(b)
5(c)
5(c)
5(d)
5(d)
6(a)
-
management
Working capital
management
Joint Product / By
product
Joint Product / By
product
Joint Product / By
product
Joint Product / By
product
Joint Product / By
product
Reconciliation
Statement
Material costing
Material costing
Material costing
Capital structure
Capital structure
Types of financing
Types of financing
Capital Budgeting
6(a)
6(a)
6(a)
-
Capital Budgeting
Capital Budgeting
Capital Budgeting
6(a)
-
Capital Budgeting
6(a)
6(b)
6(b)
6(b)
-
Capital Budgeting
Operating costing
Operating costing
Operating costing
6(b)
6(b)
-
Operating costing
Operating costing
7(a)
-
Contract costing
7(a)
-
Contract costing
7(b)
7(c)
7(d)
7(d)
7(d)
7(e)
-
Budgetary control
Marginal costing
Types of financial
Types of financial
Types of financial
Working capital
management
Calculation of total working capital
1
Preparation of Process A/c
2
Statement showing of joint product
1
Statement showing total profit
2
Statement of profit
1
Comments (per comment 0.5 mark)
2
8
Preparation of memorandum
reconciliation A/c
Meaning
Advantages
Disadvantages
Meaning
Other explanation
Meaning
Method
Present value of cash outflow proposal –
I
Present value of cash inflow proposal – I
Net present value of proposal – I
Present value of cash outflow of
proposal – II
Present value of cash inflow of proposal
– II
Net present value of proposal – II
Calculation of total cost per month
Calculation of profit
Calculation of taking per passenger per
km
Calculation of total travelling
Calculation of passenger per km per
month
Advantages (each advantages has 1
mark)
Disadvantages (each advantages has 1
mark)
Any 4 differences (each has 1 mark)
Any 4 point (each has 1 mark)
Meaning
Routes of ECB
Sources of ECB
Any 4 factors (each has 1 mark)
4
4
1
1.5
1.5
1
3
1
3
1.75
8
4
4
4
1.75
0.5
1.75
1.75
0.5
3
1
1
1.5
1.5
8
8
2
2
4
4
4
1
2
1
4
4
4
4
4
14 | P a g e

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