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GM04

Managerial Economics

Assignment No.II

Assignment Code: 2012GM04A2 Last Date of Submission: 15th May2012

Maximum Marks:100

Ques. 4 Fill in the blanks in the following table :

No. of units

of variable

input

Total

output

(No. of

units)

Marginal Product

of variable input

Average product of

variable output

3 - Unknown 30

4 - 20 -

5 125 - -

6 - 5 -

7 - - 19



FM11Financial and Management Accounting

Assignment No.II

Assignment Code: 2012FM11A2 Last Date of Submission: 15th May

2012

Maximum Marks:100

Section-B

Case Study

Ramesh developed original specification of a product and founded Ramesh

Manufacturing Ltd. In 2007 the firm manufactured 980 nos at an average price of

Rs.900/- each. In 2008 due to continuous price rise of the inputs, he raised his prices at an

average of 12%, since he knew he could sell plant’s full capacity of 980 nos per year. In

spite of price rise for the product, which sold for over Rs.1000/- for the first time.

Ramesh was surprised to learn in late 2008 (as may be seen from the financial

statements) that Ramesh Manufacturing Ltd show a decline in earnings and still worse,

decline in cash flow.

His accountant has bought the following:

i) We are following FIFO system for the purpose of issues.

ii) Costs are going up faster than 12% and they will go up further in 2009.

iii) We are not setting aside enough to replace the machinery; we need to set

aside Rs.1,65,000/- not Rs.1,50,000/- so as to be able to buy new

machinery.iv) It is still not late to switch to LIFO for 2008. This will reduce closing

inventory to Rs.3,30,000/- and raise cost of goods sold

Ramesh Manufacturing Ltd



Income statement

(Rs.000)

2008 2007

Sales 1,008 900

Cost of goods sold

Opening

inventory

320 250

Raw material 500 400

Labour 200 174

Depreciation 150 150

End inventory (-)

390

(-) 320

780 654

Gross margin 228 246

Administrative

expenses

100 92

EBIT 128 154

Interest 50 50

78 104Income tax 39 52

Profit after tax 39 52

Add: non cash

expenses

150 150

Inventory charge (-) 70 (-) 70

Cash flow 119 132

Required:

a) What is the weighted average inflation factor for the firm using LIFO?

b) If the firm desires a 15 percent profit margin on sales, how much should

the firm charge for the product per unit?



GM11

Management Functions and Organizational Behavior

Assignment No.II

Ques. 3 Discuss some of the common symptoms of interpersonal problems between

Individuals.

Section-B

Case Study

NO COMMISSIONS ALLOWED

When Mr.Ram Bansal took over the handbag department at RK & Company New Delhi, he

established several important goals for the department. One was to increase sales without

increasing the number of salespeople or the way they were paid. Unlike some retail supervisors,

Mr.Bansal was not in a position to use commissions to reward improved performance. All his

employees were paid a straight wage without commissions and all members of the staff wereunion led. He also wanted to improve customer service and employee satisfaction.

This arrangement offered few motivational options and had a negative effect on employee

attitudes. In other departments of the company, customers were often shown a dressing room

“cop” who asked how many garments were included and gave them the appropriately colored

tag. The original sales clerk rarely appeared for additional customer service. Many sales people

in the company were painfully aware of the lack of personal commitment to their job and

customers. One employee commented, “There’s a lot of talk about increasing customers.”

Mr.Bansal knew he had to make some changes in order to improve the sales production in the

department.



His first step was to give full-time employees their own counter area and their own line of

merchandise. He also increased the responsibility of the sales staff for managing their own

inventory and their own line of merchandise. Any sales person who needed information was

encouraged to offer the buying staff suggestions, was encouraged to talk with buyer of handbags.

Previously, the sales staff had felt they were not supposed to talk to buyers.

Every week, Mr.Bansal brings the staff together for a meeting. At these meetings, he

emphasizes the importance of customer service and reviews any change in departmental policies

and procedures. He also encourages employees to discuss problems and ask questions. These

meetings provide Mr.Bansal with an opportunity to publicly recognize the accomplishments of

employees.

Questions

1. What motivational need did Mr.Bansal satisfy for his full-time employees?

2. Discuss these needs with reference to Maslow’s hierarchy of needs.

3. Mr. Bansal achieved significant productivity gains because of a positive change in

employee’s attitudes. What motivational strategies did he use to achieve this success?



GM12

Business Communication

Assignment No.II

Assignment Code: 2012GM12A2 Last Date of Submission: 15th May2012

Maximum Marks:100

Section-B

Case Study

The steel manufacturing company acquired 1000acres of land near a village in another state to

start up a new manufacturing project. It had been in the business of manufacturing steel for over

70 years. It had the best integrated steel plant in the country. The state government promised the

company all kinds of facilities and full encouragement in setting up the plant. It was felt that the

plant would go a long way in fulfilling the aspirations of the backward state and its population.

The land was acquired by the company after much resistance from the villagers and tribal who

were unwilling to give up their land .The company had a tough time with the local officials too.

Much of the help and co-operation promised at the time of signing the agreement seemed to have

been forgotten.

The company officials prided themselves on having done a lot of social and community welfare

work over the last several decades. They decided to take the same route to people’s heart in this

locality as they had done where their mother locality was .The company spent several crores in

getting proper water systems in place to provide clean drinking water to the villagers surrounding

the plant.

The opposition to the acquisition kept getting stronger . The local politicians ,officials and

villagers seemed indifferent to the efforts of the company in bringing better civic amenities and

lifestyle to the place. The opposition grew so strong that it became impossible for the company

to carry on its work in a smooth way.

All cries to the state government fell on deaf ears. The state government seemed completely

apathetic to the demands and plight of the company. The company had, by now, sunk in a couple

of hundred crores into the area.It seemed the company had got itself into a real big mess.



The officials did not know whom to blame for this state of affairs. The villagers did not see the

company as their savior and the state government did not feel the company would change the

fortunes of the people in the state. There was some kind of an ambiguity and incongruity as far

as vision alignment of the respective parties was concerned .The company had failed to envision

the rest of the parties with a vision similar to its own.

It was decided in a board meeting to shelve the project. The apathy of the state government in

fulfilling its promises was cited as the major reason for this decision. The company had several

hundred crores of its capital on a project that was stillborn. This impacted the bottom-line of the

company. It also eroded the shareholder’s faith in the company. Had the officials acted with a

little more restraint in spending money, without getting to know the ground realities, the picture

could have been a lot better.

Questions

1. Jot down the reasons that you think led to the failure of the setting up a new plant.

2. Prepare a report to submit it to the management.

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