FINANCIAL AND MANAGEMENT AND ACCOUTING

MBA0041
ASSINGMENT
FALL 2014
LC-02009
NAME: NANDESHWAR SINGH
ROLL NO.1408001255

Q.1 Following information obtained from a manufacturing company:

Direct Material – 450000

Office Expenses – 120000

Factory Expenses – 90000

Total Sales – 650000

Prime Cost – 450000

25% of the output is in stock

Calculate:

(a) Direct Expenses (b) Factory Cost (c) Cost of Production(d) Cost of Sale
(e)Profit

Solution:
Direct materials 4,50,000

Prime cost 4,50,000

Factory expenses 90,000

Factory cost 5,40,000

Office expenses 1,20,000
Cost of production 4,20,000
Less : closing stock of finished goods 1,05,000

Cost of sales 3,15,000

Sales 6,50,000
Profit 3,35,000

a) Direct expenses : 4,50,000

b) Factory cost : prime cost + Factory expenses

4,50,000 + 90,000 = 5,40,000
c) Cost of production : Factory cost – office expenses
5,40,000 – 1,20,000 = 4,20,000
d) Cost of sales : 3,15,000
e) Profit : cost of sales – sales
3,15,000 – 6,50,000
= 3,35,000
Q2) Assets Fixed Asset 15,00,000

Current Asset 500000

Liabilities Accounts Payable 200000

Reserve and Surplus 100000

10% Debentures 300000

6% Preference Share Capital 300000

Equity Share Capital 1100000

1. Calculate Debt-Ratio

2. Calculate Debt-equity Ratio

Ans :

Debt ratio : Total liablities of outsider / total assets

= 200000+100000 / 15,00,000 + 5,00,000

= 300000/200000

= 0.15

Debt equity ratio :

= Debentures / Equity share cap+ preference share + Reserves

= 3,00,000 / 11,00,000 + 3,00,000 + 1,00,000

= 3,00,000/15,00,000

= 1/5 or 0.2
Q3.

Ans)

Particulars rupees %

Sales 15,00,000 100

Less: Cost of goods sold 70,000 4.7

Wage 50,000 3.3

Factory overheads 10,000 0.6

Gross profit: 13,70,000 91.3

Less: selling and distribution overhead 20,000 1.3

Administrative expenses 15,000 1.0

Earnings before interest and tax 13,35000 89

Less: Interest 35,000 2.3

Earnings before tax 13,00,000 86.6

Less : Tax 50,000 3.3

Net profit 12,50,000 83.3

Capital employed 1,25,00,000

Net profit on capital employed 10

Q4. XYZ ltd has recorded a sale of 80000 units in a year, with a selling price of Rs 8 per
unit. Moreover, the company has recorded a prime cost and variable overhead to be Rs 3
and Rs 1 respectively. The company had a fixed cost of Rs 100000

1. Calculate BEP ( in Rupees)

2. Calculate MOS

Ans :

BEP in units : Fixed cost/(sp - vc) per u

= 1,00,000 / 8 – 4

= 1,00,000 / 2 = 50,000

BEP in rupees = BEP in units × selling price per unit

= 50,000 × 8

= 4,00,000

MOS = ( Actual sales – BEP sales) / actual sales × selling price

= ( 80,000 × 8 ) – 4,00,000 / 80,000 × 8

= 6,40,000 – 4,00,000 / 6,40,000

= 2,40,000 / 6,40,000

= 37.5 %
 Q.5

Ans

Particulars jan feb Mar april May june

Reciepts
Cash sales 93,000 87,000 73,800 67,800 1,02,000 90,000
Collection from debtors 76,000 69,500 61,300 94,500 85,000
Asset 70,000
loan 50,000
Total 93,000 1,63,000 1,33,000 1,99,100 2,46,500 1,75,000

Payments

Payment to creditors 26,000 60,000

Wages 25,000 25,900 23,000 32,000 29,500 25,600
Sales and distribution
overhead 10,000 12,000 15,000 19,000 21,000 24,000
Production overhead 12,000 12,000 12,000 13,000 16,000 16,000
Administrative overhead 2,500 2,700 2,200 4000 3500 3000
49,500 78,600 52,200 1,28,000 70,000 68,600

Surplus 43,500 84,400 81,100 71,100 1,76,500 1,06,400

Opening balance 30,000 60,000 58,000 65,200 91,500 72000
Closing balance 51,600 72,000 64,300 79,100 98,700 81,100