Q.
Q.1 “Accounting is closely connected with control”. Elaborate the statement and discuss the role of accounting feedback in the process of control.
Q.2 You are required to prepare a Schedule of changes in working capital and a Funds
Flow Statement from the Balance Sheets of Amazon Ltd as on 31st Dec. 2008 and
2009.
Liabilities
2008
Rs.
2009
Rs.
Assets
2008
Rs.
2009
Rs.
Share capital
Gen. Reserve
P&L A/c
Creditors
Bills payable
Provision for taxation
Provision for doubtful debts.
2,00,000
28,000
32,000
16,000
2,400
32,000
800
2,00,000
36,000
26,000
10,800
1,600
36,000
1,200
Goodwill
Buildings
Plant
Investments
Stock
Bills receivable
Debtors
Cash & Bank balance
24,000
80,000
74,000
20,000
60,000
4,000
36,000
13,200
24,000
72,000
72,000
22,000
46,800
6,400
38,000
30,400
3,11,200
3,11,600
3,11,200
3,11,600
Additional information:
a) Depreciation provided on plant was Rs. 8,000 and on Buildings Rs. 8,000
b) Provision for taxation made during the year Rs. 38,000
c) Interim dividend paid during the year Rs. 16,000
Q.3 Take a suitable example and explain the impact of cost and volume changes on
the profits of a business.
Q.4 The Finance Director of Ritoria Ltd thinks that the project with the higher NPV should be chosen whereas its Managing Director thinks that the one with the higher IRR should be undertaken, especially as both projects have the same initial outlay and length of life. The company anticipates a cost of capital of 10% and the net after tax
