BBA402 – Management Accounting

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Bachelor of Business Administration- BBA Semester 1

BBA402 – Management Accounting

Set - 1

Q1. From the following information, find out the amount of contribution:

Fixed Cost	Rs. 50000
Variable Cost	Rs. 20 per unit
Selling Price	Rs. 25 per unit
Output Level	250000 units

Answer. Contribution per unit = Selling price per unit - variable cost per unit (OR total contribution = total sales

Q2. From the following particulars, prepare the cash flow statement for the year ended

31 March 2017 by the direct method:-

Ø  Cash sales Rs.6,00,000

Ø  Cash collected from debtors during the year amounted to Rs.3,00,000

Ø  Cash paid to suppliers was Rs.7,00,000

Ø  Rs.90,000 was paid to and for employees

Ø  Furniture of the book value of Rs.2,000 was sold for Rs.1,000 and a new furniture costing Rs.8,000 was purchased.

Ø  Debentures of the face value of Rs.30,000 were redeemed at a premium of two percent interest on debentures. Interest on debentures of Rs.8,000 was also paid.

Ø  Dividend of Rs.45,000 for the year ended 31 March 2017 was distributed in May 2017.

Ø  Cash in hand and at bank as on 31 March 2016 and 31 March 2017 was Rs.5,000 and Rs.50,000 respectively.

Answer. Cash Flow Statement (Direct Method) for the year ended 31 March 2017:-

Q3. What are the factors that affect the policy of dividend of a company?

Answer. Factors Influencing Dividend Policy

Legal considerations – The provisions of the Companies Act, 1956, must be kept in mind since they provide a

Set - 2

Q1. Budgetary control is a system of planning and controlling costs. It is a process of continuous comparison of actual performance and cost with the budget. Explain the steps in detail.

Answer. The various steps included in the budgetary control system are:

1. Determination of organizational objectives – Budget is a tool for implementing the organizational

Q2. From the following data, calculate overhead variances of following:

Variable overhead expenditure variance

Fixed overhead expenditure variance

Total overhead cost variance

Fixed overhead capacity variance

Fixed overhead calendar variance

Note: There was a five percent increase in capacity.

Answer. Calculation of standard rate for fixed overhead and variable overhead

Std. rate = Standard overheads / Standard output

Q3. The following is the balance sheet of Star Enterprise.

Calculate:

1. Current assets ratio

2. Liquid ratio

3. Solvency ratio

4. Debt-equity ratio

Answer. Current Asset Ratio:

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