PUNJAB PUBLIC SERVICE COMMISSION
COMBINED COMPETITIVE EXAMINATION
FOR RECRUITMENT TO THE POSTS OF
PROVINCIAL MANAGEMENT SERVICE, ETC.-2021
CASE NO. 3C2022
COMBINED COMPETITIVE EXAMINATION
FOR RECRUITMENT TO THE POSTS OF
PROVINCIAL MANAGEMENT SERVICE, ETC.-2021
CASE NO. 3C2022
SUBJECT: COMMERCE (PAPER-I)
TIME ALLOWED: THREE HOURS MAXIMUM MARKS: 100
TIME ALLOWED: THREE HOURS MAXIMUM MARKS: 100
NOTE:
i. All the parts (if any) of each Question must be attempted at one place instead of at different places.
ii. Write Q. No. in the Answer Book in accordance with Q. No. in the Q. Paper.
iii. No Page/Space be left blank between the answers. All the blank pages of Answer Book must be crossed.
iv. Extra attempt of any question or any part of the question will not be considered.
i. All the parts (if any) of each Question must be attempted at one place instead of at different places.
ii. Write Q. No. in the Answer Book in accordance with Q. No. in the Q. Paper.
iii. No Page/Space be left blank between the answers. All the blank pages of Answer Book must be crossed.
iv. Extra attempt of any question or any part of the question will not be considered.
Attempt Five Questions in All, Selecting minimum Two Questions from each Part. Calculator is allowed (Not programmable).
PART – A
Q No. 1: “Generally Accepted Accounting Principles (GAAP) are the foundation for a true accounting system” Do you agree with this statement? (20 Marks)
Q No. 2: From the following details prepare cash flow statement for ABC Limited for the year ended 31st December, 2015 under IAS 7 layout: (20 Marks)
Profit and Loss Account for the year ended on 31st December, 2015
Profit and Loss Account for the year ended on 31st December, 2015
Gross Profit Rs.44,700
Discount received Rs.410
Gain on Sale of Asset Rs.620 Rs. 1,030
Rs. 45,730
Discount received Rs.410
Gain on Sale of Asset Rs.620 Rs. 1,030
Rs. 45,730
Less Expenses
Vehicle / Expenses Rs. 1,940
Wages Rs.17,200
General Expenses Rs. 830
Bad Debts Rs. 520
Provision for Bad Debts Rs. 200
Depreciation Rs. 1,800
Total Expenses Rs.22,490
Net Profit Rs.23,240
Wages Rs.17,200
General Expenses Rs. 830
Bad Debts Rs. 520
Provision for Bad Debts Rs. 200
Depreciation Rs. 1,800
Total Expenses Rs.22,490
Net Profit Rs.23,240
Balance Sheet as on
Fixed Assets 2014 2015
at cost Rs.15,400 Rs.8,200
Accumulated Depreciation Rs. 5,300 Rs.3,100
Rs.10,100 Rs.5,100
Current Assets
Fixed Assets 2014 2015
at cost Rs.15,400 Rs.8,200
Accumulated Depreciation Rs. 5,300 Rs.3,100
Rs.10,100 Rs.5,100
Current Assets
Inventories Rs.18,600 Rs.24,000
Debtors Rs. 8,800 Rs. 7,700
Less Provision Rs. 600 Rs. 800
Rs. 8,200 Rs. 6,900
Cash and Bank Balance Rs. 410 Rs. 720
Total Current Assets Rs.27,210 Rs.31,620
Total Assets Rs.37,310 Rs.36,720
Debtors Rs. 8,800 Rs. 7,700
Less Provision Rs. 600 Rs. 800
Rs. 8,200 Rs. 6,900
Cash and Bank Balance Rs. 410 Rs. 720
Total Current Assets Rs.27,210 Rs.31,620
Total Assets Rs.37,310 Rs.36,720
Liabilities & Equity 2014 2015
Current Liabilities
Creditors Rs. 5,900 Rs.7,200
Long Term Liabilities
Bank Loan Rs.10,000 Rs.7,500
Total Liabilities Rs.15,900 Rs.14,700
Net Worth Rs.21,410 Rs.22,020
Capital
Opening Balance Rs.17,210 Rs.21,410
Add Net Profit Rs.21,200 Rs.23,240
Rs.38,410 Rs.44,650
Less Drawing Rs.17,000 Rs.22,630
Rs.21,410 Rs.22,020
Creditors Rs. 5,900 Rs.7,200
Long Term Liabilities
Bank Loan Rs.10,000 Rs.7,500
Total Liabilities Rs.15,900 Rs.14,700
Net Worth Rs.21,410 Rs.22,020
Capital
Opening Balance Rs.17,210 Rs.21,410
Add Net Profit Rs.21,200 Rs.23,240
Rs.38,410 Rs.44,650
Less Drawing Rs.17,000 Rs.22,630
Rs.21,410 Rs.22,020
Q No. 3: A company purchased a second-hand machine on 1st Jan., 2001 for Rs.37,000 and immediately spent Rs.2,000 on its overhauling and Rs.1,000 on its erection. On 1st July, 2002, it purchased another machine for Rs.10,000 and on 1st July, 2003 it sold off the first machine purchased in 2001 for Rs.28,000. It purchased a machine for Rs.25,000 on 1st July, 2003. On 1st July, 2004 the second machine purchased for Rs.10,000 was sold for Rs.2,000.
Depreciation was provided on the machine at 10% on the original cost annually. In 2002, however, the company changed the method of depreciation and adopted the written down value method, rate of depreciation being 15% p.a.
Required: Give the Machine Account for four years from 2001 to 2004 assuming accounting year ends on 31st December every year. (20 Marks)
Q No. 4: Given below is Income Statement of XYZ Limited for the year ended. (20 Marks)
Rupees
Sale – net 5,971,228,748
Cost of Sales 3,125,337,924
2,845,890,824
Sale – net 5,971,228,748
Cost of Sales 3,125,337,924
2,845,890,824
Distribution, selling and promotional expenses 1,499,737,319
Administrative and general expenses 270,080,061
Research and development expenses 3,606,954
Other operating expenses 84,485,841
1,957,910,175
Other Income 29,277,764
Operating Profit 917,258,413
Administrative and general expenses 270,080,061
Research and development expenses 3,606,954
Other operating expenses 84,485,841
1,957,910,175
Other Income 29,277,764
Operating Profit 917,258,413
Finance Costs 4,959,755
Profit before taxation 912,298,658
Taxation 285,834,489
Profit for the Year 626,464,169
Profit before taxation 912,298,658
Taxation 285,834,489
Profit for the Year 626,464,169
ASSETS
Non-current assets 934,825,946
Property, plant and equipment 5,073,017
Long term investment 200,000,000
Long term deposits 12,695,663
Long term advances 16,074,304
1,168,668,930
Non-current assets 934,825,946
Property, plant and equipment 5,073,017
Long term investment 200,000,000
Long term deposits 12,695,663
Long term advances 16,074,304
1,168,668,930
Current Assets
Stock in Trade 1,115,539,075
Trade Debts 250,692,198
Advances 57,879,171
Trade deposits and short term prepayments 24,329,555
Profit accrued 2,015,658
Other receivables 4,819,473
Loan to subsidiary 20,000,000
Tax refunds due from the Government 5,611,106
Short term investments 100,000,000
Cash and Bank Balance 612,566,431
2,193,452,667
Stock in Trade 1,115,539,075
Trade Debts 250,692,198
Advances 57,879,171
Trade deposits and short term prepayments 24,329,555
Profit accrued 2,015,658
Other receivables 4,819,473
Loan to subsidiary 20,000,000
Tax refunds due from the Government 5,611,106
Short term investments 100,000,000
Cash and Bank Balance 612,566,431
2,193,452,667
Total Assets 3,362,121,597
Liabilities & Equity
Current Liabilities
Bank Borrowing 800,000,000
Trade Creditors 500,000,000
1,300,000,000
Long Term Liabilities
Deposits 500,000,000
Current Liabilities
Bank Borrowing 800,000,000
Trade Creditors 500,000,000
1,300,000,000
Long Term Liabilities
Deposits 500,000,000
Equity
Paid up Credit 500,000,000
General Reserves 1,062,121,597
1,562,121,597
Paid up Credit 500,000,000
General Reserves 1,062,121,597
1,562,121,597
Total Liabilities & Equity 3,362,121,597
Additional Information
i) Company declared dividend @30% during the year.
ii) Market value of the share is Rs.600 while face value is Rs.10/-
iii) Company has no long term borrowings.
iv) Prepayments are 10% of the respective item.
i) Company declared dividend @30% during the year.
ii) Market value of the share is Rs.600 while face value is Rs.10/-
iii) Company has no long term borrowings.
iv) Prepayments are 10% of the respective item.
Required
Compute following ratios:
i) Gross Profit Margin
ii) After Tax Profit Margin
iii) Return on Equity
iv) Dividend Yield
v) Dividend Payout
vi) Times Interest Earned
vii)Current Ratio
viii)Quick Ratio
ix) Breakup value of shares
x) Earnings Per share
Compute following ratios:
i) Gross Profit Margin
ii) After Tax Profit Margin
iii) Return on Equity
iv) Dividend Yield
v) Dividend Payout
vi) Times Interest Earned
vii)Current Ratio
viii)Quick Ratio
ix) Breakup value of shares
x) Earnings Per share
PART- B
Q No. 5: Explain the following terms with examples and imaginary data if required. (20 Marks)
a) Applied Factory Overhead
b) Cost of Product Report
c) Economic Order Quantity
d) Internal Rate of Return
e) Opportunity Cost
a) Applied Factory Overhead
b) Cost of Product Report
c) Economic Order Quantity
d) Internal Rate of Return
e) Opportunity Cost
Q. No. 6: Use LIFO on the following information to calculate the value of ending inventory.
(20 Marks)
(20 Marks)
Mar 1 Beginning Inventory 60 units @ $15.00
Mar 5 Purchase 140 units @ $15.50
Mar 14 Sale 190 units @ $19.00
Mar 27 Purchase 70 units @ $16.00
Mar 29 Sale 30 units @ $19.50
Mar 5 Purchase 140 units @ $15.50
Mar 14 Sale 190 units @ $19.00
Mar 27 Purchase 70 units @ $16.00
Mar 29 Sale 30 units @ $19.50
Q No. 7: In June, the idle capacity variance of Cool Corporation was zero, and spending variance was Rs.6,000 unfavorable. In July, the idle capacity variance was Rs.8,000 unfavorable, but the spending variance was zero. In June, actual overhead expense was Rs.70,000 for an output of 8,000 tons. July’s expense was Rs.56,000 and output was 6,000 tons. In August, output was 9,000 tons, and actual overhead expense was Rs.71,000.
Required: (1) Factory overhead budgeted (estimated) for 9,000 tons.
(2) Factory overhead applied in August.
(3) Variances for August.
(20 Marks)
(2) Factory overhead applied in August.
(3) Variances for August.
(20 Marks)
Q. No. 8: Naveed Manufacturing Co. presents the following information for the year ended 31st December, 1999.
(20 Marks)
(20 Marks)
Sales 252000 Commission 2500
Sales Returns and Allowances 2000 Advertising 4000
Purchases of Raw Material 96200 Depreciation of Sales Office 2200
Carriage In 300 Travelling Expenses 1800
Direct Labour 60000 Bad Debts 700
Purchases Return 1200 Salaries 2000
Indirect Material 4300 Stationery Used 1125
Indirect Labour 4700 Rent of Office 1500
Rent of Factory 3500 Interest Received 1110
Factory Taxes 1150 Interest Paid 275
Insurance of Factory Building 1500
Depreciation of Plant and Machinery 3425
Heat, Light and Power 2225
Sales Returns and Allowances 2000 Advertising 4000
Purchases of Raw Material 96200 Depreciation of Sales Office 2200
Carriage In 300 Travelling Expenses 1800
Direct Labour 60000 Bad Debts 700
Purchases Return 1200 Salaries 2000
Indirect Material 4300 Stationery Used 1125
Indirect Labour 4700 Rent of Office 1500
Rent of Factory 3500 Interest Received 1110
Factory Taxes 1150 Interest Paid 275
Insurance of Factory Building 1500
Depreciation of Plant and Machinery 3425
Heat, Light and Power 2225
INVENTORIES
Jan. 1 Dec. 31
Raw Material 9000 12000
Work in Process 16100 13900
Finished Goods 17600 15300
Jan. 1 Dec. 31
Raw Material 9000 12000
Work in Process 16100 13900
Finished Goods 17600 15300
Required:
- Prepare Cost of Goods Manufactured and Sold Statement
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