MCS : questions
Management Control System
Prelim Exam April 2012 – (60 marks)
Solve ANY FOUR out of Q Nos.1 to 7 and ANY FOUR out of Q Nos.8 to 12. Q. NOs.1 to 7 carries 8 marks each and Q nos. 8 to 12 carries 7 marks each.
1) What is Responsibility centre? List and explain different types of Responsibility centres.
2) What do you understand by Balance Score Card? Describe the steps for implementation and difficulties in implementation.
3) Explain briefly various stages of Management control process citing salient features of each.
4) What do you understand by Goal Congruence? What are the informal factors that influence Goal Congruence?
5) a)Transfer pricing is not an accounting tool. Comment with illustrations. b) Market price is ideal transfer price even in limited markets. Comment
6) What is a Strategic Business Unit? What are the conditions required for creating SBUs? How the performance of SBU is measured? What are the advantages and disadvantages of creating SBUs?
7) Write short notes on:
a) Zero Based budgeting
b) Financial audit
c) Internal audit
d) Management control in Matrix organisation
e) Free cash flow
8) A company is currently working at 50% capacity. It sells 20000 units now. Price per unit is Rs.100/- The cost per unit is Rs.90/- Break up of this is as follows –
Marginal cost Rs.40/-
Manufacturing cost Rs.30/0 (30% fixed)
Selling cost Rs.10/- (20% fixed)
Administrative cost Rs. 10/- (20% fixed)
When company works at 80% capacity, selling price would fall by 5% and material cost would go up by 5%.At full capacity, selling price would fall by 8% and material cost would go up by 8%.
Calculate profit at each level and comment whether company should work at full capacity level and why?
9) Anand and Company comprises of five divisions A, B, C, D and E and present performance matrix is Return on Assets (ROA). However, controller has suggested the management, to switch over
Prelim Exam April 2012 – (60 marks)
Solve ANY FOUR out of Q Nos.1 to 7 and ANY FOUR out of Q Nos.8 to 12. Q. NOs.1 to 7 carries 8 marks each and Q nos. 8 to 12 carries 7 marks each.
1) What is Responsibility centre? List and explain different types of Responsibility centres.
2) What do you understand by Balance Score Card? Describe the steps for implementation and difficulties in implementation.
3) Explain briefly various stages of Management control process citing salient features of each.
4) What do you understand by Goal Congruence? What are the informal factors that influence Goal Congruence?
5) a)Transfer pricing is not an accounting tool. Comment with illustrations. b) Market price is ideal transfer price even in limited markets. Comment
6) What is a Strategic Business Unit? What are the conditions required for creating SBUs? How the performance of SBU is measured? What are the advantages and disadvantages of creating SBUs?
7) Write short notes on:
a) Zero Based budgeting
b) Financial audit
c) Internal audit
d) Management control in Matrix organisation
e) Free cash flow
8) A company is currently working at 50% capacity. It sells 20000 units now. Price per unit is Rs.100/- The cost per unit is Rs.90/- Break up of this is as follows –
Marginal cost Rs.40/-
Manufacturing cost Rs.30/0 (30% fixed)
Selling cost Rs.10/- (20% fixed)
Administrative cost Rs. 10/- (20% fixed)
When company works at 80% capacity, selling price would fall by 5% and material cost would go up by 5%.At full capacity, selling price would fall by 8% and material cost would go up by 8%.
Calculate profit at each level and comment whether company should work at full capacity level and why?
9) Anand and Company comprises of five divisions A, B, C, D and E and present performance matrix is Return on Assets (ROA). However, controller has suggested the management, to switch over