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Distribution of 50 marks Exam Paper- 30 marks Group Assignment and attendance - 20 marks Format of Exam Paper Question 1 -Compulsory

- Practical- 10 marks Any two out of balance four questions Question 2) a) Practical - 5 marks b) Theory - 5 marks Question 3) a) Practical - 5 marks b) Theory - 5 marks Question 4) a) Practical - 5 marks b) Theory - 5 marks Question 5) a) Practical - 5 marks b) Theory - 5 marks Topics for group assignment 1) Impact of marketing policies on a firms a) working capital, b) credit policy, c) credit rating, d) credit recovery 2) Optimal stock holding 3) Break even analysis 4) Marketing decisions like pricing, product mix, expansion, etc 5) Marketing investment appraisal using DCF techniques 6) Appraisal of distribution channels, advertisement strategy 7) Leasing and bill discounting concepts 8) Brand valuation. 1) Budgetary Control 2) Impact of Marketing Policies on Firms Overall Receivables Management 3) Marketing Analysis and Cost Control 4) Marketing Performance Evaluation 5) Pricing 6) Stock out and loss of profit,

Budgetary Control 1) From the following information you are required to prepare a sales budget for the next year: Budgeted sales for the current year Product Calcutta Patna Gauhati A 6000 @ Rs. 10 8000 @ Rs.10 5000 @ Rs.10 B 3000 @ Rs.15 10000 @ Rs.15 3000 @ Rs.15 C 2000 @ Rs.20 12000 @ Rs.20 4000 @ Rs.20 After careful analysis and study the following suggestions are presented. a) Sales of Product A can be increased by 30%, 40% and 80% in Calcutta, Patna and Gauhati respectively. b) Sales of Product B can be increased by 20% in Patna and 40% in Gauhati, but will be reduced by 20% in Calcutta c) Sales of Product C can be increased by 20% in Calcutta. 40% in Patna and 50% in Gauhati, provided that the budget committee approves a price reduction. d) The following prices are changed by the budget committee Product A will be increased by 20% Product B will be increased by 10% Product C will be reduced by 10%. 2) The budget officer of A,B,C Ltd in consultation with other members of budget committee decides to compile a budget for selling and distribution costs based on the selling and distribution cost budget of the current year. Selling and distribution cost budget for the current year is Particulars Direct Selling Expenses Salesmans Salaries Salesmans commission Entertainment and car exp Sales Office Expenses Salaries to Staff Rent Rates etc General Expenses Advertising Expenses Press and Radio Shop Window display Distribution Expenses Warehouse Wages Drivers Wages General Expenses North(Rs.) 4,800 4,950 2,500 3,600 200 800 4,000 1,000 2,400 1,800 600 South(Rs.) 7,200 7,950 2,700 5,400 300 1000 5,000 1,500 3,600 2,400 800 Total(Rs.) 12,000 12,900 5,200 9,000 500 1800 9,000 2,500 6,000 4,200 1,400

The following changes over the current budget were also considered necessary during the next budget period. a) Salesmans salary to be increased by 10% and one more salesman at Rs. 200 per month is to be employed in South Division. b) Salesmans commission will be increased from 5% to 6% on sales, entertaining and car expenses will be increased by 10%. c) Salaries to staff will be increased by 10%, two clerks(one for each division) are to be employed each to be paid Rs. 150 per month d) Rent, rates and general expenses will go up by 5%. e) Advertising through Press and Radio will be increased by 30% and shop display by 10%. f) Warehouse mens and drivers wages will be increased by 10% and all other distribution expenses will be increased by 5%. g) The sales during the next year estimated are to be Rs. 1,30,000 and Rs. 1,90,000 for the north and south division respectively. Prepare a selling and distribution cost budget for the next year.

3) XY Co Ltd manufactures two products X and Y and sells them through two divisions East and West. For the submission of sales budget to the budget committee the following information has been made available: Budgeted sales for the current year: Product East West X 4,000 @ Rs.9 6,000 @ Rs. 9 Y 3,000 @ Rs. 21 15,000 @ Rs. 21 Adequate market studies reveal that product X is popular but under-priced. It is observed that if the price of X is increased by Re. 1, it will still find a ready market. On the other hand Y is over-priced and the market could absorb more if sales price of Y be reduced by Re. 1. The management has agreed to do so. For the information based on these price changes and reports from salesman, the following estimates have been prepared by divisional managers. Percentage increase in sales over current budget is Product East West X +10% +5% Y +20% +10% With the help of intensive advertisement campaign the following additional sales over the above estimated sales are possible. Product East (Units) West (Units) X 600 700 Y 400 500 Prepare a Sales Budget.

4) A theatre with some surplus accommodation proposes to extend its catering facilities to provide light meals to it patrons. The management board is prepared to make initial funds available to cover capital costs. It requires that these be repaid over a period of five years at a rate of interest of 14% and discounting factors at this rate are indicated below Year Discounting Factor 0 1 1 0.88 2 0.77 3 0.67 4 0.59 5 0.52

The capital costs are estimated at Rs. 60,000 for equipment that will have a life of five years and no residual value. Running costs of staff, etc., will be Rs. 20,000 in the first year, increasing by Rs. 2,000 in each subsequent year. The board proposes to charge Rs. 5,000 per annum for lighting, heating and other property expenses and wants a nominal Rs. 2,500 per annum to cover any unforeseen contingencies. Apart from this, the board is not looking for any profit, as such, from the extension of these facilities, because it believes that this will enable more theatre seats to be sold. It is proposed that costs should be recovered by setting prices for the food at double the direct costs. It is not expected that the full sales level will be reached until Year 3. The proportions of the level estimated to be reached in Years 1 and 2 are 35% and 65% respectively. You are required to calculate the budgeted sales needed to be achieved in each of the five years to meet the boards targets. Ignore taxation and inflation.