Department of EEE

VR Siddhartha Engineering College

Paper: EE 421: ENGINEERING ECONOMICS AND ACCOUNTANCY

II – MID TERM EXAMINATION

Total: 15 Marks

I. Answer ALL questions: 1x 5= 5 M

Explain
a. Cost b. Marginal analysis
c. Return on Investment d. Demand & Supply
e. Budget

II. Answer ONE from the following: 1x4=4M

a. What are the cost reduction techniques?
b. Discuss various aspects of Indian Economy.

III. Answer the following (Compulsory): 1x6=6M

The following has been extracted from the books of M/s HCL Limited for the calendar
year 2006.
Opening stock of raw material : 25000
Purchase of raw material : 85000
Closing stock : 40000
Carriage inward : 5000
Wages : Direct : 75000
Indirect : 10000
Other direct expenses : 15000
Rent & Rates : Factory : 5000
Office : 500
Indirect consumption material : 500
Depreciations : Plant : 1500
Furniture : 100
Salary : Office : 2500
Salesmen : 2000
Other factory expenses : 5700
Other office expenses : 900
Managing Director’s Remuneration : 12000
Other selling expenses : 1000
Traveling expenses of salesmen : 1100
Carriage and freight outward : 1000
Sales : 250000
Advertisement : 2000
Managing Director’s remuneration is to be allocated as Rs.4000 to the factory,
Rs.2000 to the office and Rs.6000 to the selling departments.
From the above information prepare
(i) Prime Cost
(ii) Works Cost
(iii) Cost of Production
(iv) Cost of Sales
(v) Net profit