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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , 1., , The Balance Sheet of X Ltd. stood as follows as on:, Amount in INR Lakhs, , Liabilities, Capital, Reserves, Loans, Creditors & Others, Current Liabilities, , 31-Mar-18, 1,500, 696, 600, , 31-Mar-17, 1,500, 600, 720, , 774, , 150, , Assets, Fixed Assets, Less: Depr., Net Fixed Assets, Investment, Stock, Debtors, Cash & Bank, Other Current Assets, Misc. Expenditure, , T otal, 3,570, 2,970, You are given the following information for the year 2017-18:, Sales, , 3,600, , Profit before Interest & Tax, , 900, , Interest, Provision for Tax, , 144, 360, , Proposed Dividend, , 300, , 31-Mar-18, 2,400, 840, 1,560, 240, 720, 420, 120, 150, 360, 3,570, , 31-Mar-17, 1,800, 600, 1,200, 180, 600, 300, 120, 150, 420, 2,970, , Required:, (i) Calculate for the year 2017-18:, A. Return on Capital Employed. = [ Total Earning / Avg. Capital Employed ]*100, B. Stock Turnover Ratio. = Net Sales / Avg. stocks, C. Return on Net Worth. = [ Total Earning / Avg. Net worth ]*100, D. Current Ratio. = Current Assets / Current Liabilities, E. Proprietary Ratio = Proprietary Funds / Total Assets, Avg. Capital Employed will be considered. Capital Employed = Net Fixed Assets + Working Capital, Net Worth = Share Capital + Reserve & Surplus – Revaluation reserve – Accumulated losses, if any, Proprietary Funds = Equity Share Capital + Pref. Share Capital + reserve & Surplus – Accumulated Losses, 2. From the following figures extracted from the financial and cost accounting records, you are required to, compute:, (i) Value Added., (ii) Ratio of Operating Profit to Sales., (iii) Ratio of Operating Profit to Value Added., Particulars, , INR in lakhs, , Net Sales, , 42,000, , Increase in Stock of finished goods, , 500, , 1 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , Expenses:, Raw Materials consumed, Packing materials consumed, , 8,600, 2,560, , Stores and spares consumed, , 1,120, , Power and fuel, , 9,200, , Insurance, , 240, , Direct salaries and wages, , 960, , Depreciation, , 1,770, , Interest paid, , 2,796, , Factory overhead:, Salaries and wages, , 480, , Others, , 500, , Selling and distribution expenses:, Salaries and wages, Administration overheads:, , 240, , Salaries and wages, , 240, , Answer:, (i), Computation of Value Added, INR in lakhs INR in lakhs, Net Sales+ Increase in Stock of Finished Goods, 42,500, Le ss:, Cost of bought out materials and services:, Raw Materials –, 8,600, Packing Materials, 2,560, Stores and Spares, 1,120, Power and fuel, 9,200, Insurance, 240, Other factory overhead, 500, 22,220, Value Adde d, 2 0,280, Composition of Value Added:, Depreciation (Company as retained funds), 1,770, Interest, 2,796, Salaries and wages (960 + 480 + 240 + 240), 1,920, 6,486, Profit before tax (balancing figure) (Company as retained funds), 13,794, Ope rating Profit : (Com pany as re taine d funds), PBT, 13,794, Interest paid, 2,796, 16 ,590, , 2 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , Ratio of operating profit to net sales = Operating Profit / Net Sales = 16,590 / 42,000 ×100 = 39.50%, Ratio of operating profit to value added = Operating Profit / Value Added = 16,590 / 20,280 ×100 = 81.80%, 3., M Ltd has the following Balance Sheets as on 31 March 2018 and 31 March 2017:, Particulars, , INR in lakhs, 31 March 2018, , Sources of Funds:, Shareholder’s Fund, Loan Funds, Applications of Funds:, Fixed Assets, Cash & Bank, Debtors, Stock, Other Current Assets, Less: Current Liabilities, , 31 March 2017, 4,954, 7,340, 12 ,294, , 3,144, 6,366, 9,510, , 7,132, 1,178, 3,190, 5,934, 3,334, (8,074), 12 ,694, , 6,000, 1,140, 2,536, 5,014, 3,008, (7,788), 9,910, , The Income Statement of the M Ltd for the year that ended is as follows:, , INR in lakhs, 31-Mar-18, , 31-Mar-17, , Sales, , 44,530, , 27,964, , Less: CGS, , 41,920, , 25,288, , GP, Less: Selling, General & Administrative Expenses, , 2,610, 2,070, , 2,676, 1,304, , Earnings before Interest and Tax (EBIT), , 540, , 1,372, , Less: Interest Expense, Profit before tax, , 226, 314, , 210, 1,162, , 46, , 384, , 268, , 778, , Less: Tax, Profit after Tax, Required:, (i) Calculate for the year 2017-18, a. Inventory Turnover Ratio, b. Return on Net worth, c. ROI, d. ROE, e. Profitability ratio, , 3 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , (ii) Give a brief comment on the financial position of M Ltd., 4., , Following are the summarized accounts of Key Ltd and Pee Ltd fo r the 2 years 2017 and 2018:, , Particulars, , INR in Lakhs, Key Ltd, , Sales, Manufacturing &, Other Expenses, Depreciation, Profit before Tax, Miscellaneous, Expenditure, Fixed Assets, Stock, Debtors, Bank, Creditors, Taxation [Less, Advance Tax], Short-term, Borrowings, Long-term, Borrowings, Capital & Reserves, , 2017, 5,412, 5,104, , 2018, 4,575, 4,356, , Pee Ltd, 2017, 1,752, 1,496, , 56, 252, 5,412, 165, , 51, 168, 4,575, 169, , 60, 196, 1,752, -, , 35, 230, 1,447, -, , 836, 1,124, 728, 93, 2,946, 947, 56, , 941, 1,219, 824, 33, 3,186, 926, 68, , 351, 177, 582, 464, 1,574, 233, 87, , 275, 226, 402, 246, 1,149, 175, 58, , 424, , 800, , 464, , 216, , 254, , 210, , 10, , -, , 1,265, 2,946, , 1,182, 3,186, , 780, 1,574, , 700, 1,149, , 2018, 1,447, 1,182, , You are required to:, (i) Indicate and calculate five Ratios which in your opinion are relevant in determining the stability of the two, companies., (ii) Compare the Ratios so determined for the two companies. Indicate what conclusions can be drawn therefrom?, , 4 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , Utilities Consumption, , 7 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , VALUE ADDITION, Difference between net output value(net sales adjusted for WIP and finished stock) and cost of bought out, materials and services for the product under reference., , 14 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , INVENTORY VALUATION, , 17 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , ABNORMAL EVENTS SUCH AS STRIKE, LOCK-OUT AND OTHER FACTORS, , 18 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , PROFITABILITY ANALYSIS, , 19 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , RECONCILIATIONS OF FINANCIAL AND COST RECORDS, , 27 For query E-mail [email protected] or cell No.: +91-9308305682.

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All Practical questions for CMA Final Paper 19. Cost and Management Audit., , By: CMA. Rakesh Ranjan, , Management Reporting under Cost Audit., , 34 For query E-mail [email protected] or cell No.: +91-9308305682.