IAS Mains Commerce Papers 1996

IAS Mains Commerce 1996

Paper I

Section A

  1. Answer any three of the following, each in about 200 words:

    1. Cost is a crucial leg in the tripod of pricing decision as having the character of internal control. Elucidate.

    2. Examine the significance of audit note book and audit working papers as a proof of defence against the negligence of auditors.

    3. Once bearer instrument is always a bearer instrument. Explain. What are the protections available against paying banker in case of bearer instruments?

    4. Write a note on responsibility accounting.

  2. Answer the following questions

    1. Explain the provisions of the Income Tax Act relating to taxation of agricultural income.

    2. Mr. Y is a resident and ordinary resident employed as a Manager in a private sector company working in Patna. The following particulars are finished by him for the previous year ending 31st March, 1995:

    • Salary received Rs. 86, 000
    • Dearness allowance Rs. 88, 500
    • House rent allowance Rs. 22, 500

    Mr. Y owns a house in Delhi consisting of two portions. The fair rental value of the house is

    Rs. 60, 000 per annum.

    One portion of the house is lest out to his friend on a monthly rent of Rs. 4, 000 and another portion is kept for his self occupation in which his son studying in IIT Delhi is residing. He paid municipal taxes amounting to Rs. 10, 500 and incurred Rs. 8, 000 on repairs during the previous yea.

    However he resides in a rented house in Patna by paying a monthly rent of Rs. 3, 000. The company advanced him an amount of Rs. 1, 00, 000 free of interest which he invested in shares. The company had paid Ks. 6, 000 as interest on the loan. The dividends received from these shares during the previous year were Rs. 14, 500. He paid Rs. 1.5000 towards life insurance premium on a life policy of Rs. 1, 00, 000. During the previous year he received Rs. 16, 000 being ⅓ share from a registered firm. Compute the total income of Mr. Y for the assessment year 1995 − 96.

  3. Answer the following questions

    1. Distinguish between cost control and cost reduction. Examine flexible budgetary control as a control technique.

    2. The following details relate to a manufacturing company:

    Contribution margin of a product is Rs. 6 which is 30 % of sales price. The annual fixed costs are Rs. 8, 00000 which include Rs. 1, 20.000 towards depreciation. Find both BEP and cash break even point. Calculate number of units required to be sold to earn a net income of 10% of sales.

  4. Answer the following questions

    1. Evaluate the role of life Insurance Corporation of India as a premier investment agency to Government of India.

    2. Write a note on SEBI guidelines relating to trading and settlement procedures in stock exchanges.

Section B

  1. Answer any three of the following in about 200 words each:

    1. Impact of inflation is more pronounced in fixed investment resources. Discuss.

    2. Commercial expediency determines the charge of expenses and losses in computing profits and gains of business and profession. Explain.

    3. Segregation of overheads into fixed and variable is however critical, it is needed for efficient cost control management. Discuss.

    4. Is auditor liable for misstatement in prospectus? Discuss the nature and extent of auditors liability in this regard.

  2. Answer the following questions

    1. Examine the significance of shut down point in managerial decision making. What are the applications of differential costing in this regard?

    2. X Y Z Ltd. Is engaged in the production of a commodity which is produced by 3 distinct processes. The process costs for the year ending 31st. March. 1996 are as follows:

    • Materials Rs. 1, 60, 000
    • Labour Rs. 1, 24, 800
    • Overheads Rs. 62, 400
    • The opening and closing work in progress is a follows:
    • Opening work in progress
    • Amount
    • Rs.
    • Closing work in progress
    • Degree of competition
    • Degree of competition
    • Materials
    • Labour
    • Overhead 100% 60% 50% 8, 000 3, 000 9, 000 75% 50% 40%

    There are 3, 000 units of opening work in progress. 7, 000 units are introduced in the process and 8, 500 units are transferred to next process.

    Prepare statement of equivalent production and statement of cost using FIFO method of valuation of inventory.

  3. Optimum capital structure aims at profit maximisation rather than wealth maximisation, but it is a mythical proposition. Discuss.

  4. Answer the following questions

    1. Write a note on working capital problems of Indian industries.

    2. Explain the disclosure norms of banking companies. What are the protections available against non-disclosure of assets and liabilities?

    3. During a certain period, the production plant of Nova Company Ltd worked for 9, 926 hours against the allowed hours of 10, 032. The normal capacity is 10, 560 hours. The actual fixed overhead rate is Rs. 2 and fixed and variable expenses at normal capacity are Rs. 8, 000

    Rs. 11, 200 respectively. Actual factory overhead expenses are Rs. 18, 540. Calculate overhead variances.

Paper II

Section A

  1. Write short notes on any three of the following in not more than 200 words each:

    1. Significance of Organisation

    2. Goal succession

    3. Management of conflicts

    4. Vrooms Valency & Expectancy Theory

  2. Describe the contributions of Taylor and Taylor to the Development of Organisation theory. What are the criticisms made on their work? Do you agree with them? Substantiate your argument with examples.

  3. What is the importance of Leadership? Describe its various styles. Discuss their relative merits and demerits.

  4. Define organisation development. What are its characteristics and limitations? How is it different from organisation growth? Give examples.

Section B

  1. Write short notes on any three of the following in not more than 200 words each:

    1. Economic satisfaction of workers

    2. Importance of International Labour Organisation (ILO)

    3. Workers participation in Management at present

    4. Executive development

  2. Examine the functions of Trade Unions relating to an Industrial Organisation and evaluate their effectiveness Discuss how Trade Unions can strengthen the organisation to meet the stiff competition existing in the market. Illustrate.

  3. Explain the process of collective bargaining including the conditions essential for its success. What are its limitations? Discuss how you propose to overcome them in the present dynamic business environment. Give examples.

  4. What is personnel research? For this purpose, explain the essentials of effective record-keeping. Give a brief account of personnel research in India along with an assessment of future research needs.