SAMPLE QUESTION PAPER

Accounting and Decision Making Techniques

SEMESTER: 1





























Part A
Q 1

a) What are the various ways in which Quantitative methods can help managers in managing
business activities scientifically. Give examples.

b) For the following grouped data find the mean, median and mode:

Class Interval Frequency
0-10
10-20
20-30
30-40
40-50
10
20
35
25
10


c) The salespersons of a company are graded on three factors as indicated in the following
table.

Salesperson Sales Customer
care
Absenteeism
A 9 6 6
B 7 8 8
C 8 7 7
D 8 9 9
E 7 8 8

To rank them, weightings of 5, 4 and 3 were assigned to Sales, Customer care and
Absenteeism respectively. Find the weighted average for each salesperson and rank them
in order of merit.
(11 + 11 +11 = 33 marks)

Q 2

All formulae/ calculations to be shown clearly in the following problem:

Customers arrive at a Information centre with a single service point at an average of 15
per hour. Determine the average number of customers in the queue and the average time
in the queue if the service takes three minutes on an average. If the service time can be
reduced to an average of two minutes, what would the impact be?

(08 +08+ 17 = 33mrks)



Part B
Q 3


The following trial balance has been extracted from the books of AP LTD. as at 31
st
December 2006.

DR CR
000 000
Opening Stock 70
Trade Debtors 150
Bank 30
General Reserve 60
Creditors 42
Interim Dividends 15
Bad Debts 3
Land & Buildings 400
Ordinary Share Capital (1 shares) 300
Profit & Loss Account 125
Purchases 356
Sales 694
6% Debentures 100
Debenture interest 3
Machinery
- At cost 150
- accumulated depreciation 35
Vehicles
- At cost 165
- accumulated depreciation 130
Administrative Expenses 20
Wages & Salaries 100
Insurance 15
Rent & Rates 60
Light, Heat & Telephone 9
Provision for Doubtful Debts 4


1516 1516


Additional Information:

1. Stock at 31.12.06 was valued at 85,000

2. Depreciation is to be charged as follows:

Machinery: 15% on cost.
Vehicles: 10% on reducing balance basis
No depreciation to be provided for the buildings.

3. Insurance prepaid amounts to 3000 and telephone bill of 300 is still owed.

4. The provision for doubtful debts should be made equal to 5% of trade debtors.

5. The directors have recommended a final dividend of 6p per ordinary share to transfer 3000 to
general reserve.

6. Taxation for the year amounts to 20,000.


REQUIRED:

a) Trading, P&L and Appropriation A/C for the year ended 31
st
December 2006. [27 marks]

b) State and explain a fundamental accounting concept used in preparing the above profit statement.
[6 marks]
Total 33 marks




Q 4

The following information relates to a new electronic game to be introduced by K Ltd.

Selling price per unit 99
Variable cost per unit 66

Fixed costs attributable to this product are 495,000.


REQUIRED

a) The contribution-sales ratio and its meaning [3 marks]
b) The break-even point in units and value [8 marks]
c) Profit or loss if sales were 25,000 units and 1,386,000 [8 marks]
d) Sales revenue required to give a profit of 264,000. [6 marks]
e) Margin of safety if the sales were as in (c) and (d) above. [3 marks]
f) State the assumptions made in the above calculations [5 marks]


Total 33 marks















Q 5

The following information has been prepared for RA plc in order to prepare a cash flow statement for the
year ended 30
th
September 2006. The information is incomplete as it does not provide details of the cash
flows for the financing activity.

m
Operating profit 112
Depreciation 58
Profit on sale of assets 1
Decrease in stocks 4
Increase in debtors 122.7
Increase in creditors 55.3
Interest paid 48
Tax paid 18
Purchase of fixed assets 194
Sale of fixed assets 2
Dividends paid 36

Required:

a) Prepare an extract of the cash flow statement based on the above information.[15 marks]
b) Identify and explain briefly the main USES of cash from the cash flow statement. [10 marks]
c) What are the main differences between the three main financial statements? [8 marks]

Total 33 marks






























FORMULAE for ADM

1. Average:
n
x
x

= or

=
f
x f
x
.


2. Binomial Distribution: ( )
x n x
x
q p nC x X P

= =
3. Traffic density

=
4. Condition for convergence: ( ( or 1

5. Probability that the server is idle: = 1
0
P
6. Average number of customers in the system:

=
1
L
7. Average number of customers in the queue:

=
1 ) (
2 2
q
L
8 . Waiting time in the system:

=
1
T
9 . Waiting time in the queue:
) (

=
q
T