MCS-035
Question 1
(a) “Describe various ratios that are likely to help management of a manufacturing company forming an opinion on the solvency position of business.
(b) Under what circumstances may NPV and IRR give conflicting recommendations? Which criteria should be followed in such circumstances and why?
Question 2
What is meant by working capital management? What factors would you like to take into consideration in estimating the working capital requirement of a concern? Discuss the repercussions if a firm has inadequate working capital.
Question 3
Write short notes on the following:
(a) Provision for bad and doubtful debts
(b) Interest on Capital
(c) Provision for discount on Creditors
(d) Treatment of abnormal loss in final accounts
Question 4
Following are the balance sheets of a limited company as on 31st December, 2016 and 2017.
Liabilities
|
2016
Rs.
|
2017
Rs
|
Asset
|
2016
Rs.
|
2017
Rs
|
Share Capital
P & L A/c
Creditors
Bills payable
Bank
Loan(Long term)
Reserve
|
60,000
8600
22,000
8,000
22000
16000
|
75,000
9000
18000
9000
……
19800
|
Furniture
Building
Stock
Debtors
Goodwill
Bank
Cash
|
36000
50950
25500
21500
2,500
……..
150
|
43,000
48000
20000
15000
1520
3100
180
|
1,36,600
|
1,30,800
|
1,36,600
|
1,30,800
|
Taking into account the following additional information, you are required to prepare funds flow statement and statement of changes in working capital.
(a) Rs. 8,000 was paid as dividend during the year.
(b) Depreciation on Furniture was charged Rs. 4000 and on Building, it was Rs.3000.
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