Commerce UPSC PYQ 2015

What is the impact of 'Halo Effect' on Performance Appraisal ? Explain.

Give a critical appraisal of the Modigliani-Miller (MM) approach to the theory of capital structure.

Discuss the mechanism of levy of Value Added Tax.

What is corporate restructuring ? State the major forms in which it can be carried out.

Differentiate between 'Basic Earnings Per Share' and 'Diluted Earnings Per Share' with reference to Indian Accounting Standard.

"Compared to factory workers, it is more difficult to attempt job analysis, job description, and job specification for the Scientists and Engineers working in Research and Development Departments." Comment. How does the HR Department help management to address these challenges effectively ?

Human Resource Accounting.

Force Field Analysis

In post modern-organisations, are traditional concepts like line and staff functions irrelevant ? Do you think so ? Give arguments in support of your answer.

Explain briefly the factors influencing the working capital requirement.

Examine with an example the relationship between leverage and profitability.

What are the objectives and functions of Auditing and Assurance Standards Board (AASB) ? Explain.

The Balance Sheets of S Ltd. at 31st March, 2012 and 31st March, 2013 are as under : Particulars | 31-3-2012 (₹) | 31-3-2013 (₹) --- | --- | --- Equity and Liabilities : Shareholder's Funds : Share Capital | 50,000 | 70,000 General Reserve | 5,000 | 8,000 Profit and Loss A/c | 10,000 | 15,000 Current Liabilities : Creditors | 15,000 | 19,000 Bills Payable | 4,000 | 5,000 Outstanding Expenses | 1,000 | 500 Total | 85,000 | 1,17,500 Assets : Non-Current Assets : Building | 50,000 | 80,000 Machinery | 8,000 | 12,000 Current Assets : Stock in Trade | 5,000 | 7,500 Debtors | 20,000 | 15,000 Cash and Bank Balance | 2,000 | 3,000 Total | 85,000 | 1,17,500 Following further information is available : (i) Depreciation of ₹ 5,000 on building and ₹ 2,000 on machinery has been charged for the year 2012 - 2013. (ii) A machine costing ₹ 1,200 was sold on 1st April, 2012 for ₹ 800. Depreciation of ₹ 700 was provided on the same upto 31st March, 2012. Prepare classified cash flow statement for the year ended on 31st March, 2013.

Following table shows relevant financial items of X Ltd. as on 1st April, 2014 : Items | ₹ --- | --- Intangible Assets | 50,000 Inventories at cost | 1,00,000 Share Capital (Face Value = ₹ 2 per share) | 50,000 Cash and Bank balances | 1,50,000 10% Bonds | 25,000 Receivables | 30,000 Total Sources | 3,60,000 Creditors | 25,000 Plant (Net of depreciation) | 30,000 Plant at cost | 50,000 Transactions during the year are given below : (i) Sold 60% of the inventories on credit for ₹ 2,00,000. (ii) Salary for the period paid fully ₹ 20,000. (iii) Rent per year ₹ 10,000. Paid rent for three years. (iv) Intangible assets amortized over next four years equally. (v) Plant is 4 years old. Depreciation is charged using the Straight Line Method (SLM) (for both tax and accounting purposes). (vi) Purchased shares of Y Ltd. worth ₹ 50,000 by issuing shares at ₹ 20 per share. (vii) Redeemed Bonds on 31st March, 2014 (after the payment of interest) by issuing shares at the market price of ₹ 25 per share. (viii) Paid off 60% of the creditors. (ix) Tax paid @ 30% of profits. Prepare Balance Sheets as at 1st April, 2014 and 31st March, 2015 along with Profit & Loss a/c and Cash a/c for the year ended on 31st March, 2015.

Explain in brief the concept of 'Activity Based Costing'. Give a numerical example.

A Ltd. is considering the replacement of one of its machines. The existing machine is in good operating condition, but the company is looking for a bigger machine. The existing machine is 5 years old, and has remaining depreciable life of 10 years. The machine was purchased for ₹ 1,50,000 and is being depreciated at ₹ 10,000 per year for tax purposes. The new machine will cost ₹ 2,20,000 or ₹ 1,70,000 if exchanged with the existing machine. It will be depreciated on a straight line basis for 10 years with no salvage value. The management anticipates that, with the increased operations, there will be a need for an additional net working capital of ₹ 30,000. The new machine will allow the company to expand current operations thereby increasing annual revenue by ₹ 60,000 and variable operating costs from ₹ 2,00,000 to ₹ 2,20,000. The company's tax rate is 35% and its cost of capital is 10%. Should the company replace its existing machine ? Assume that the loss on exchange of existing machine can be claimed as short-term capital loss in the current year itself.

Pen down strike vs Tool down strike.

"Collective bargaining requires mutual trust among key stakeholders within an industry." Comment. What considerations are to be taken into account in managing collective bargaining arrangements ?

Conciliation vs Mediation in Disputes Resolution.

Calculate the degree of operating leverage, degree of financial leverage and degree of combined leverage for the following firms : | N | S | D --- | --- | --- | --- Production (in units) | 17,500 | 6,700 | 31,800 Fixed costs (₹) | 4,00,000 | 3,50,000 | 2,50,000 Interest on long-term loan (₹) | 1,25,000 | 75,000 | NIL Selling price per unit (₹) | 85 | 130 | 37 Variable cost per unit (₹) | 38 | 42.50 | 12 You are also required to interpret the results of your calculation.

Explain the provisions of the Income Tax Act, 1961 with regard to set-off and carry forward of loss under the head Income from Business and Profession and Capital Gains.

"Majority of I.T. Companies are keen to reduce their labour turnover." What are the reasons for it ? How could exit interviews and post exit questionnaires enable them to do so ? Comment.

Discuss the utility and limitations of Internal Rate of Return (IRR) method of appraising a capital investment decision.

Cost and revenue information of A Ltd. is as follows : Contribution to Sales Ratio = 30%; Variable cost = ₹ 7 per unit; Break-even point is equal to 10,000 units. Find the following : • Company reduces the selling price by 10%, reduces the variable cost to ₹ 6 and spends ₹ 4,000 on advertisement. Find sales to earn a profit of ₹ 6,000. • Company increases the selling price by 20%; reduces the variable cost to ₹ 6 and spends ₹ 4,000 on advertisement. Find the break-even volume of sales.

"Changing Indian labour legislations is the last unfinished agenda since 1991." Assess its rationale.

Psychological Contract

Write a note on the relevance of credit-rating for a power sector company.

"Competitiveness of Indian industry is directly linked with digitisation initiatives." Identify the issues involved and implication of this statement.

Balance Score Card

Behavioural Anchored Rating Scale.

"Organisation culture is the long term phenomenon that decides the success or failure of the mission and vision of the organisation and ultimately its survival in the current global scenario." Explain this statement and also identify the cultural problems of modem business organisations.

Mr. S is employed by A Ltd. at Delhi throughout the financial year ended on 31st March, 2015. He furnishes the following particulars for computation of his income for the assessment year 2015 - 16 : (i) Basic Salary @ ₹ 50,000 per month (ii) Personal Pay @ ₹ 30,000 per month (iii) Conveyance Allowance @ ₹ 3,000 per month (iv) Uniform Allowance @ ₹ 2,000 per month (v) Knowledge Update Allowance @ ₹ 2,500 per month (vi) Medical Allowance @ ₹ 5,000 per month (vii) Entertainment Allowance @ ₹ 1,000 per month (viii) He is provided with gift vouchers of ₹ 15,000 per year. (ix) His employer contributes 15% of the basic salary to his recognised provident fund account. Similar amount is deducted from his salary as his contribution to the fund. (x) He gets house rent allowance @ ₹ 20,000 per month against a rent of ₹ 25,000 per month paid by him for his residential accommodation. (xi) His employer paid electricity and telephone bills of his residential house amounting to ₹ 70,000 and ₹ 20,000 respectively for the whole year. (xii) During the year he made the following payments : I. Life insurance premium ₹ 1,20,000 (sum assured is ₹ 10 Lacs) II. Life insurance premium on the life of his major son ₹ 25,000 III. Mediclaim policy premium paid in cash ₹ 30,000 IV. Donation of ₹ 2,00,000 to an approved charitable trust Compute his taxable income for the assessment year 2015 - 16.

Describe the nature of the following debt instruments : (i) Deep Discount Bonds (ii) Floating Rate Bonds (iii) Extendable Notes (iv) Junk Bonds

Distinguish between Divisible profits and Dividends.

Accountability vs Responsibility.

Explain the role of IRDA in regulating insurance business in India.

"Retained earnings have no cost." Comment.

Explain briefly the factors that determine the dividend policy of a company.

"Constitutional provisions are in favour of Workers Participation in Management, but its implementation requires effective strategies." Discuss.

What is inter-process profit ? Show the treatment of inter-process profit with an example.

Explain in brief the regulations of SEBI for Buy-back of shares by a company.

Explain the accounting for VAT, with examples.

"Organisational citizenship behaviour enhances the effectiveness of quality circles." Comment.

What is meant by empowered organisations ? Suggest steps to foster an empowered organisation.

"S-O-B-C model gives only a bare bones sketch of organisation behaviour rather than a full blown explanation. However it can serve as a conceptual framework for organisational behaviour." What do you mean by this statement ? Give suggestions to enrich this model.

Banning Lockouts.

"Since liberalisation there has been continuous pressure on the functioning of regulatory agencies which monitor Indian business organisations." Evaluate this statement and suggest remedial measures to enhance their effectiveness.

What is positive psychology ? How can Indian companies use the concepts of the same to foster entrepreneurial thinking in their workforce ? Explain.

According to Hendry Mintzberg, how does the power dynamics between various parts of the organisation, result in different structural forms of organisation ? What are these structural forms, and how do they affect organisational effectiveness ?

"I.T. Companies in India seek special concessions in the Factories Act of 1948, for their establishments." What are these concessions ? Do you agree that these should be granted ? Give arguments in support of your answer.

"360° feedback system is gaining popularity." Comment. Also examine the barriers to its effective implementation in India.

"Cafeteria Scheme allows individual employees to decide, with certain limits, on the make up of their Fringe Benefits Package." Discuss. Also examine the implications of this statement.

What is the need and importance of sampling in audit ? Briefly outline the analytical procedures to be adopted while conducting audit.

"Cash from operations (CFO) is not the same as profit after tax (PAT)." Do you agree with this statement ? Give reasons using the Accounting Standard - 3.

Explain the important ratios that will be used in each of the following situations : (i) A bank is approached by a company for a working capital facility of ₹ 50 lacs. (ii) A long-term creditor who is interested in knowing whether his claim is adequately secured. (iii) A shareholder who is examining his portfolio to decide whether to hold or sell his holdings in the company. (iv) A finance manager who is interested to know the effectiveness with which the available resources are utilised.