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Q1. Describe the necessary pre-requisites for an efficient budgetary control system.

Q2. Illustrate the significant merits and demerits of the negotiated transfer pricing technique in divisional performance measurement.

Q3. D Limited manufactures Product A use two raw materials: X and Y. Find out the relevant cost of materials in each of the given conditions:

a) Material X is already in stores that were purchased earlier @ Rs.10/- per unit. It has no further use and if not utilized for producing Product A, the material can be sold @ Rs.8/- per unit in the open market, acquiring an expense of Re.1/- per unit.

b) Material Y is regularly employed for production and can be procured @ Rs.20/- per unit. If it is utilized for producing Product A, it has to be replenished instantly.

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