JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD MCA 2022 ACCOUNTING AND FINANCIAL MANAGEMENT Previous Question Paper (May - 2022 - R15)
Answer any five questions. All questions carry equal marks.
Main
What are the various books of account? Explain the objectives of Trial Balance.
Answer
The primary books of account include the Journal, which serves as the book of original entry where transactions are recorded chronologically, and the Ledger, which is the book of final entry where transactions are classified into specific accounts. Additionally, Subsidiary Books are maintained to record repetitive transactions, such as the Purchases Journal, Sales Journal, Cash Book, and Bills Receivable/Payable books.
The objectives of preparing a Trial Balance are:
- To verify the arithmetical accuracy of the ledger accounts by ensuring total debits equal total credits.
- To provide a summarized list of all ledger balances, which serves as a foundation for preparing final financial statements.
- To detect clerical errors made during the posting process, such as errors of omission or commission.
- To facilitate the identification of discrepancies before the final accounts are closed.
Record following transactions in the Purchases Journal and port them in the ledger.
2018 Jan.1 Purchased from Ram & co. on credit: 38 immersion heaters @ Rs.200/-, 20 tube lights @ Rs.500/-. Jan. 4 Purchased from Shyam &co. on credit: 40 immersion heaters @ Rs.200/-, 20 tube lights @ Rs.450/-. Jan. 8 Purchased from Bajaj &co. on credit: 20 Electric Irons @ Rs.600/-, 3 electric mixers @ Rs.2,000/-. Jan. 24 Purchased from KC & Co. on credit: 30 Electric Kettles @ Rs.300/-, 40 able fans @ Rs. 1500/-.
Answer
Purchases Journal
| Date | Name of Supplier | Details | Amount (Rs.) |
|---|---|---|---|
| 2018 Jan 1 | Ram & Co. | (38*200) + (20*500) = 7600 + 10000 | 17,600 |
| 2018 Jan 4 | Shyam & Co. | (40*200) + (20*450) = 8000 + 9000 | 17,000 |
| 2018 Jan 8 | Bajaj & Co. | (20*600) + (3*2000) = 12000 + 6000 | 18,000 |
| 2018 Jan 24 | KC & Co. | (30*300) + (40*1500) = 9000 + 60000 | 69,000 |
| Total | 1,21,600 |
Ledger Accounts (Summary)
Purchases A/c: Debited with Rs. 1,21,600 (To Sundry Creditors A/c).
Ram & Co. A/c: Credited with Rs. 17,600 (By Purchases A/c).
Shyam & Co. A/c: Credited with Rs. 17,000 (By Purchases A/c).
Bajaj & Co. A/c: Credited with Rs. 18,000 (By Purchases A/c).
KC & Co. A/c: Credited with Rs. 69,000 (By Purchases A/c).
Explain Accounting cycle.
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Explain the term convention of Disclosure and going concern concept.
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The well-established company’s most recent balance sheet is as follows:
| Liabilities | Amount | Assets | Amount |
|---|---|---|---|
| Equity Capital(₹10 per share) | ₹6,00,000 | Net fixed assets | ₹15,00,000 |
| 10% Lon-term debt | ₹8,00,000 | Current assets | ₹ 5,00,000 |
| Retained earnings | ₹2,00,000 | ||
| Current liabilities | ₹4,00,000 | ||
| Total | ₹20,00,000 | Total | ₹20,00,000 |
The company’s total assets turnover ratio is 3, its fixed operating costs are ₹10,00,000 and the variable costs ratio is 40 percent. The income tax rate is 35 percent.
Calculate all the three types of leverages.
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Determine the likely level of EBIT if EPS is i) ₹1 ii) ₹3 and iii) zero.
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Explain the goals of financial management.
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How weighted average cost of capital is calculated?
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Explain the uses of ratio analysis.
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The following is an extract of a balance sheet of a company during the last year. Compute current ratio and quick ratio. Also interpret the ratios.
Land and buildings Rs. 1,50,000/-, Plant and Machinery Rs.3,00,000/-, Furniture and fixtures Rs.1,25,000/-, Closing stock Rs. 25,000/-, Sundry debtors Rs. 62,500/-, Wages prepaid Rs. 7,500/-
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Distinguish between statement showing changes in working capital and funds flow statement.
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What is a cash flow statement?
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Why Breakeven point is critical to an organization and its managerial implications? Discuss.
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Explain about sales budget and cash budget.
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A company is planning to purchase a machine to meet the increased demand for its products in the market. The machine costs ₹ 5,00,000 and has no salvage value. The expected life of the machine is 5 years, and the company employs straight line method of depreciation for tax purposes. The estimated earnings after taxes are ₹ 50,000 each year for 5 years. The after-tax required rate of return of the company is 12 percent. Determine the IRR.
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