JNTU
JNTU MBA 1 FINANCIAL ACCOUNTING AND ANALYSIS Previous Question Paper (March - 2023 - R19)
Note: i) Question paper consists of Part A, Part B.
ii) Part A is compulsory, which carries 25 marks. In Part A, Answer all questions.
iii) In Part B, Answer any one question from each unit. Each question carries 10 marks and may have a, b as sub questions.
Part A
Explain the limitations of Accounting.
Answer
Accounting has several limitations that affect the reliability and completeness of financial statements:
- It is based on historical costs, which may not reflect current market values.
- It ignores qualitative factors like employee morale, brand reputation, or management efficiency.
- It is influenced by personal judgments and estimates, such as the choice of depreciation methods or inventory valuation.
- It does not account for changes in the purchasing power of money due to inflation.
- It can be subject to window dressing, where financial statements are manipulated to present a better picture than reality.
Define Depreciation. List out any three objectives of Depreciation.
Answer
Depreciation is the systematic allocation of the cost of a tangible fixed asset over its useful life, reflecting the wear and tear, obsolescence, or passage of time. The three main objectives are:
- To determine the true profit or loss by charging the cost of asset usage against revenue.
- To present a true and fair view of the financial position by showing assets at their book value.
- To provide funds for the replacement of assets at the end of their useful life.
Illustrate why is Single entry system of Accounting considered as an incomplete system.
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Describe the word cash from Operations. How can it be determined?
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How do you compute ‘Operating Expenses Ratio’?
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Part B
What do you understand by ‘Generally Accepted Accounting Principles’? Enumerate the various institutions that influence the Indian GAAP.
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Explain the process of implementation of accounting principles in organizations.
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Describe the meaning of “Accounting Principles”, what are the essential features?
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What is basic accounting equation?
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India Ltd. charges depreciation on plant and machinery under Reducing Balance System @ 15% Per Annum. Show the plant and machinery Account.
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From the following particulars presented by Thilak for the year ended 31st March, 2017, prepare profit and loss account.
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Aswin purchased a machine for Rs. 2,50,000. Prepare Machinery Account.
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Enter the following transactions in the appropriate journal of M/s Vas and Co.
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Define the concept ‘Goodwill’ and bring out the different factors that influence the value of Goodwill of a business firm. Illustrate with imaginary data, any two popular methods of Goodwill.
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Calculate the missing figure for capital at the beginning.
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Explain the methods of Inventory valuation.
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Explain how to ascertainment of profit from incomplete records.
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Explain distinction between cash profits and book profits.
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Illustrate paid cost and unpaid costs in detail.
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What are the differences between Cash flow statements and Fund flow statements?
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What are the limitations of Cash flow statements? How are cash flows classified as per AS-3?
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Rs. 2,40,000 is the cost of goods sold. Inventory turnover is 8 times. Calculate the value of the opening and closing stock.
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What are liquidity ratios? What are their uses?
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Explain Accounting Standard 6 (Revised) related to Depreciation Accounting.
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What is solvency? Define and explain two of the ratios used for solvency.
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