Friday, December 18, 2015

University Of Pune Question Paper,2010 Question Paper,P. G. D. B. M. (Semester - II),FINANCIAL MANAGEMENT

University Of Pune Question Paper
P. G. D. B. M. (Semester - II) Examination - 2010
(New 2008 Pattern)
Time : 3 Hours] [Max. Marks : 70
Instructions :
(1) Question No. 1 is compulsory.
(2) Attempt any two questions each from section I and section II.
(3) Figures to the right indicate full marks.
(4) Use of simple calculator is allowed.
Q.1) ABC Ltd. has an Average Selling Price of Rs. 150 per unit. Its Variable
Unit Cost is Rs. 105 and Fixed Cost Amounts to Rs. 25 lakhs. It
finances all its assets by equity funds. It pays 35% tax on its income.
XYZ Ltd. is identical to ABC Ltd. except in respect of the pattern
of financing. The later finances its assets 50% by equity and 50%
by debt, the interest on which amounts to Rs. 3,00,000.
Calculate Relevant Leverages at Rs, 1,05,00,000 sales for both the
firms. [10]
Q.2) What are the characteristics of various forms of Business
Organisation ? [15]
Q.3) Explain Concept of Under-capitalisation with respect to its causes,
consequences and remedies. [15]
Q.4) Explain factors which determine Dividend Policy of a Company. [15]
Q.5) Write short notes : (Any Three) [15]
(a) ADR and GDR
(b) Public Deposit
(c) Trading on Equity
(d) Factoring
(e) Pay Back Period Method
Q.6) Ram Ltd. plans to sell 30,000 units next year. The expected cost of
goods sold is as follows :
Rs. (Per Unit)
Raw Material 100
Manufacturing Expenses 30
Selling, Administration Expense 20
Selling Price 200
The duration at various stages of the operating cycle is expected to
be as follows :
Raw Material Stage 2 months
Work-in-Progress 1 month
Finished Goods Stage 1/2 month
Debtors Stage 1 month
Assuming the monthly sales level of 2,500 units.
(a) Calculate investment in various current assets.
(b) Estimate gross working capital requirement if the desired cash
balance is 5% of the gross working capital requirement. [15]
[3887]-202 2 Contd.
Q.7) One of the two machines A and B is to be purchased. From the
following information find out which of the two will be more
profitable. The average rate of tax may be taken at 50% :
Machine A Machine B
Rs. Rs.
Cost of Machine 50,000 80,000
Working Life 4 years 6 years
Earning before tax after depreciation :
1st year 10,000 8,000
2nd year 15,000 14,000
3rd year 20,000 25,000
4th year 15,000 30,000
5th year – 18,000
6th year – 13,000
Calculate Pay Back Period and Average Rate of Return and comment. [15]
Q.8) A company needs Rs. 12 lakhs for the installation of a new factory
which would yield an annual EBIT of Rs. 2,00,000. The company has
an objective of maximizing the earnings per share. It is considering
the possibility of issuing equity shares plus raising a debt of
Rs. 2,00,000, Rs. 6,00,000 or Rs. 10,00,000. The Current Market Price
per share is Rs. 40 which is expected to drop to Rs. 25 per share
if the market borrowings were to exceed Rs. 7,50,000.
Cost of Borrowings are indicated as under :
Upto Rs. 2,50,000 10% p.a.
Between Rs. 2,50,000 to Rs. 6,25,000 14% p.a.
Between Rs. 6,25,001 and Rs. 10,00,000 16% p.a.
Assuming a tax rate of 50% work out the EPS and the scheme which
would meet objectives of the Management. [15]
Q.9) Write short notes : (Any Two) [15]
(a) Bonus Shares
(b) Commercial Papers
(c) Fund Flow Statement
(d) Time Value of Money
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