School of Management Studies
INDIRA GANDHI NATIONAL OPEN UNIVERSITY
MAIDAN GARHI, NEW DELHI – 110 068
MS-04
ASSIGNMENT
Course Code : MS-04
Course Title : Accounting and Finance for Managers
Assignment Code : MS-04/TMA/SEM-I/2018
Coverage : All Blocks
Note : Attempt all the questions and submit this assignment on or before 30th April, 2018 to the
coordinator of your study center.
1. How is ‘Financial Accounting’ different form ‘Management Accounting’? Discuss the role
and activities of an Accountant.
2. The Balance Sheets of XYZ Ltd as on 31st December, 2016 and 2017 are as given below:

Additional Information:-
(i) Depreciation provided on plant was 8,000 and on building was Rs. 8,000.
(ii) Provision for taxation made during the year is Rs. 38,000.
(iii) Interim dividend paid during the year is Rs. 16,000.
From the above information, you are required to prepare Schedule of changes in Working
Capital and Funds Flow Statement.
3. What do you understand by CVP Analysis. Explain the effect of Price and Volume on the
Net Profit, with the help of a suitable illustration.
4. The Management of ABC Ltd. is considering a proposal to purchase an improved model
of a machine which gives increased output. Its existing machine which has been in
operation for 2 years has current market value of Rs. 1,00,000, its remaining estimated
useful life is 10 years, with no salvage value at the end.

Repairs and Maintenance per
year
9,000 6,000
Working Capital 25,000 40,000
The company follows the straight-line method of depreciation and is subject to 50% tax.
Should the existing machine be replaced? Assume that the company’s required rate of
return is 15% and that the loss on sale of Assets is tax deductible.
5. As a Finance Manager how would you determine the Optimal Cash balance that would be
required by your Organisation? What measures you would take to ensure the smooth and
efficient Management of Cashflows in the Orgnisation?