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Q15. The annual requirement of an item is 18,000 units. Unit cost of material is Rs. 27 and ordering cost is Rs. 150 per order. The inventory carrying cost is 20% of the average inventory per annum. Required: (i) Calculate economic order quantity and number of order per year. (ii) Would Compare the total cost in the both cases. (2) you accept a 2% price discount on a minimum supply of quantity of 1,200 units? (3)

Q15. The annual requirement of an item is 18,000 units. Unit cost of material is Rs. 27 and ordering cost is Rs. 150 per order. The inventory carrying cost is 20% of the average inventory per annum. Required: (i) Calculate economic order quantity and number of order per year. (ii) Would Compare the total cost in the both cases. (2) you accept a 2% price discount on a minimum supply of quantity of 1,200 units? (3)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Additional information: Sales during the year are Rs. 1,500,000. (ii) Gross profit margin is 40% of sales. (iii) Net profit before interest and tax is Rs. 165,000. (iv) Opening inventory is amounted to Rs. 50,000. (v) Tax bracket is 50%. Required: (10x 0.5) (i) (ii) Acid-test ratio (iii) Inventory turnover ratio (iv) Debt-Equity ratio (v) Net profit after tax (i) Current ratio (vi) Fixed assets turnover ratio (vii) Return on shareholders' equity (viii) Return on equity shareholders' equity (ix) Capital employed turnover ratio (x) Earnings per share Q15. The annual requirement of an item is 18,000 units. Unit cost of material is Rs. 27 and ordering cost is Rs. 150 per order. The inventory carrying cost is 20% of the average inventory per annum. Required: (i) Calculate economic order quantity and number of order per year. (2) (ii) Would you accept a 2% price discount on a minimum supply of quantity of 1,200 units? Compare the total cost in the both cases. (3) SECTION C: LONG ANSWER QUESTIONS (2 X 10 = 20 MARKS) Answer any TWO questions: Q16. What are the accounting concepts and conventions? Name them and explain any four accounting concepts in detail. Q17. You are given the following trial balance for the year ended 31 December, 2019. апy (2 +4 + 9) st Debit Balance Rs. Credit Balance Rs. 45,000 | Capital 85,000| 10% Bank loan 15,000 Sundry creditors 95,000 | Bank Overdraft 150,000 | Provision for doubtful debts 20,000 | Purchase returns 62,000 | Sales 15,000 | Rent received 30,000 Discount received 2,000 Opening stock Plant and Machinery 90,000 50,000 7,470 20,000 Furniture and fixtures Land and Building Purchases 4,000 1,500 363,000 15,000 2,500 Salaries Sundry debtors Manufacturing expenses Manufacturing wages Carriage inwards Carriage outwards Administrative expenses Selling expenses 2,100 13,000 7,500 1,200 Bad debts Discount allowed 750 Rent, rates and taxes 1,620 Prepaid insurance Director's fee 1,800 3,000 3,500 553,470 Cash at Bank 553,470 Adjustments:
Transcribed Image Text:Additional information: Sales during the year are Rs. 1,500,000. (ii) Gross profit margin is 40% of sales. (iii) Net profit before interest and tax is Rs. 165,000. (iv) Opening inventory is amounted to Rs. 50,000. (v) Tax bracket is 50%. Required: (10x 0.5) (i) (ii) Acid-test ratio (iii) Inventory turnover ratio (iv) Debt-Equity ratio (v) Net profit after tax (i) Current ratio (vi) Fixed assets turnover ratio (vii) Return on shareholders' equity (viii) Return on equity shareholders' equity (ix) Capital employed turnover ratio (x) Earnings per share Q15. The annual requirement of an item is 18,000 units. Unit cost of material is Rs. 27 and ordering cost is Rs. 150 per order. The inventory carrying cost is 20% of the average inventory per annum. Required: (i) Calculate economic order quantity and number of order per year. (2) (ii) Would you accept a 2% price discount on a minimum supply of quantity of 1,200 units? Compare the total cost in the both cases. (3) SECTION C: LONG ANSWER QUESTIONS (2 X 10 = 20 MARKS) Answer any TWO questions: Q16. What are the accounting concepts and conventions? Name them and explain any four accounting concepts in detail. Q17. You are given the following trial balance for the year ended 31 December, 2019. апy (2 +4 + 9) st Debit Balance Rs. Credit Balance Rs. 45,000 | Capital 85,000| 10% Bank loan 15,000 Sundry creditors 95,000 | Bank Overdraft 150,000 | Provision for doubtful debts 20,000 | Purchase returns 62,000 | Sales 15,000 | Rent received 30,000 Discount received 2,000 Opening stock Plant and Machinery 90,000 50,000 7,470 20,000 Furniture and fixtures Land and Building Purchases 4,000 1,500 363,000 15,000 2,500 Salaries Sundry debtors Manufacturing expenses Manufacturing wages Carriage inwards Carriage outwards Administrative expenses Selling expenses 2,100 13,000 7,500 1,200 Bad debts Discount allowed 750 Rent, rates and taxes 1,620 Prepaid insurance Director's fee 1,800 3,000 3,500 553,470 Cash at Bank 553,470 Adjustments:
Jestha 3. Sold to Bheri Electric Shop, Jajarkot: 100 pieces of 10 watts LED bulbs @ Rs. 200 each 200 pieces of 10 watts CFL bulbs @ Rs. 150 each Trade discount 10%, packing & delivery charges Rs. 1,000 and VAT is charged @ 13% Jestha 12. Sold to Gaire Electric Shop, Dailekh: 20 pieces of celling fans @ Rs. 2,000 each 10 pieces of table fans @ Rs. 750 each Trade discount 10%, packing and delivery charges Rs. 800 and VAT @ 13% Sold old chairs to Pratima Stores, Surkhet for Rs. 5,000 on credit. Sold to Praksh Electric Stores, Surkhet: 20 pieces of electric iron @ Rs. 800 each 10 pieces of electric thermos @ Rs. 2,000 each Jestha 18. Jestha 26. Trade discount 5% and VAT @ 13% Required: (2) (1) (2) a) Sales Book b) Sales Account c) Debtors Account Q13. Enter the following transactions in the Cash Book with Cash and Bank Columns: – Jan.1 Cash in hand Rs. 8,000 and bank overdraft Rs. 10,500 Jan. 4 Received a cheque from BhusanRs. 3,250 Jan. 7 Deposited above cheque into bank Jan. 15 Paid to Mohan by chequeRs. 3,500 Jan. 18 Bhusan'scheque returned dishonoured Jan. 20 Withdrew from Bank for office use Rs. 2,500 Jan. 25 Cheque received from Sachin and endorsed it in favour of Kamal on 28th January Rs. 1,200 Jan. 30 Income Tax paid by chequeRs. 550 Jan. 30 Bank charges Rs. 100 Jan. 30 Cash withdrawn from bank Rs. 3,000 for payment of salary of the office staff, which was paid on next day (5) Q14. The Balance Sheet of Shree Company Ltd as on 31 March, 2020 is given below: Owners' Equity & Liabilities Equity Shares of Rs. 10 each 10% Preference Shares of Rs. 10 Rs. Assets Rs. 300,000 Land & Building 200,000 | Plant & Machinery 20,000 Furniture & Fixtures 50,000 Inventory 100,000 | Sundry Debtors 70,000 Prepaid Expenses 10,000 Cash at Bank 100,000 250,000 50,000 100,000 100,000 20,000 120,000 10,000 750,000 each Reserve Fund Profit and Loss A/c 15% Debenture Sundry Creditors Outstanding Expenses Preliminary Expenses 750,000
Transcribed Image Text:Jestha 3. Sold to Bheri Electric Shop, Jajarkot: 100 pieces of 10 watts LED bulbs @ Rs. 200 each 200 pieces of 10 watts CFL bulbs @ Rs. 150 each Trade discount 10%, packing & delivery charges Rs. 1,000 and VAT is charged @ 13% Jestha 12. Sold to Gaire Electric Shop, Dailekh: 20 pieces of celling fans @ Rs. 2,000 each 10 pieces of table fans @ Rs. 750 each Trade discount 10%, packing and delivery charges Rs. 800 and VAT @ 13% Sold old chairs to Pratima Stores, Surkhet for Rs. 5,000 on credit. Sold to Praksh Electric Stores, Surkhet: 20 pieces of electric iron @ Rs. 800 each 10 pieces of electric thermos @ Rs. 2,000 each Jestha 18. Jestha 26. Trade discount 5% and VAT @ 13% Required: (2) (1) (2) a) Sales Book b) Sales Account c) Debtors Account Q13. Enter the following transactions in the Cash Book with Cash and Bank Columns: – Jan.1 Cash in hand Rs. 8,000 and bank overdraft Rs. 10,500 Jan. 4 Received a cheque from BhusanRs. 3,250 Jan. 7 Deposited above cheque into bank Jan. 15 Paid to Mohan by chequeRs. 3,500 Jan. 18 Bhusan'scheque returned dishonoured Jan. 20 Withdrew from Bank for office use Rs. 2,500 Jan. 25 Cheque received from Sachin and endorsed it in favour of Kamal on 28th January Rs. 1,200 Jan. 30 Income Tax paid by chequeRs. 550 Jan. 30 Bank charges Rs. 100 Jan. 30 Cash withdrawn from bank Rs. 3,000 for payment of salary of the office staff, which was paid on next day (5) Q14. The Balance Sheet of Shree Company Ltd as on 31 March, 2020 is given below: Owners' Equity & Liabilities Equity Shares of Rs. 10 each 10% Preference Shares of Rs. 10 Rs. Assets Rs. 300,000 Land & Building 200,000 | Plant & Machinery 20,000 Furniture & Fixtures 50,000 Inventory 100,000 | Sundry Debtors 70,000 Prepaid Expenses 10,000 Cash at Bank 100,000 250,000 50,000 100,000 100,000 20,000 120,000 10,000 750,000 each Reserve Fund Profit and Loss A/c 15% Debenture Sundry Creditors Outstanding Expenses Preliminary Expenses 750,000
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