Download JNTUH MBA 2018 Dec 2nd Semester Financial Management Question Paper

Download JNTUH (Jawaharlal Nehru Technological University Hyderabad) MBA (Master of Business Administration) R16 2018 December Second Semester (2nd Sem) Financial Management Question Paper.

HallTicketNo QuestionPaperCode:CMB008
.
.
MBAIISemesterEndExaminations(Supplementary)-December,2018
Regulation: .?R16
FINANCIALMANAGEMENT
Time: 3Hours (MBA) MaxMarks: 70
AnswerONEQuestionfromeachUnit
AllQuestionsCarryEqualMarks
Allpartsofthequestionmustbeansweredinoneplaceonly
UNIT?I
1. (a) WhatisFinancialManagement?Explainany?veobjectivesofFinancialManagement? [7M]
(b) Assumetheinterestratetobe12%.Computetheannualpercentage/e?ectiverate,iftheperiod
is:(i)Annual(ii)Semiannual(iii)Quarterly [7M]
2. (a) Di?erentiatepro?tmaximizationandwealthmaximization [7M]
(b) XinvestsRs.1,000for3yearsinasavingsaccountthatpays10%interestperannum.Calculate
thefuturevalue. [7M]
UNIT?II
3. (a) ExplainindetailanyfouradvantagesandthreedisadvantagesofNPVmethod. [7M]
(b) 20years20%debenturesofa?lmaresoldatarateofRs.180.Thefacevalueofthedebentures
isRs.200,50%taxisassumed.Findthecostofdebt. [7M]
4. (a) ExplaintheprocedureofWeightedAverageCostofCapital(WACC). [7M]
(b) You are given with the following information relatingtoABC Ltd., forthe yearsofrecent
performanceofanasset. Initialcashoutlay?Rs. 50,000;lifeoftheasset?5years;estimated
annualcash?ow?Rs.12,500.CalculatetheIRRinbetween10%and15%D.F. [7M]
UNIT?III
5. (a)WhatisCapitalStructure?Discussanysixfactorsa?ectingCapitalStructure. [7M]
(b)OrientalLimitedcurrentlyhasordinarysharecapitalofRs.25,00,000consistingof25,000equity
sharesofRs. 100each. Thecompany?sEBITisRs. 8,00,000. AssumingCorporatetaxrate
as50%. Themanagementisplanningtoraiseanother20,00,000to?nancemajorexpansion
programme,throughoneofthefourpossible?nancialplans.Commentwhichofthealternateis
thebestandwhy?
i.Entirelythroughordinaryshares
ii.Rs.10,00,000throughordinarysharesandresthrough8%longtermloan [7M]
Page1of3
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HallTicketNo QuestionPaperCode:CMB008
.
.
MBAIISemesterEndExaminations(Supplementary)-December,2018
Regulation: .?R16
FINANCIALMANAGEMENT
Time: 3Hours (MBA) MaxMarks: 70
AnswerONEQuestionfromeachUnit
AllQuestionsCarryEqualMarks
Allpartsofthequestionmustbeansweredinoneplaceonly
UNIT?I
1. (a) WhatisFinancialManagement?Explainany?veobjectivesofFinancialManagement? [7M]
(b) Assumetheinterestratetobe12%.Computetheannualpercentage/e?ectiverate,iftheperiod
is:(i)Annual(ii)Semiannual(iii)Quarterly [7M]
2. (a) Di?erentiatepro?tmaximizationandwealthmaximization [7M]
(b) XinvestsRs.1,000for3yearsinasavingsaccountthatpays10%interestperannum.Calculate
thefuturevalue. [7M]
UNIT?II
3. (a) ExplainindetailanyfouradvantagesandthreedisadvantagesofNPVmethod. [7M]
(b) 20years20%debenturesofa?lmaresoldatarateofRs.180.Thefacevalueofthedebentures
isRs.200,50%taxisassumed.Findthecostofdebt. [7M]
4. (a) ExplaintheprocedureofWeightedAverageCostofCapital(WACC). [7M]
(b) You are given with the following information relatingtoABC Ltd., forthe yearsofrecent
performanceofanasset. Initialcashoutlay?Rs. 50,000;lifeoftheasset?5years;estimated
annualcash?ow?Rs.12,500.CalculatetheIRRinbetween10%and15%D.F. [7M]
UNIT?III
5. (a)WhatisCapitalStructure?Discussanysixfactorsa?ectingCapitalStructure. [7M]
(b)OrientalLimitedcurrentlyhasordinarysharecapitalofRs.25,00,000consistingof25,000equity
sharesofRs. 100each. Thecompany?sEBITisRs. 8,00,000. AssumingCorporatetaxrate
as50%. Themanagementisplanningtoraiseanother20,00,000to?nancemajorexpansion
programme,throughoneofthefourpossible?nancialplans.Commentwhichofthealternateis
thebestandwhy?
i.Entirelythroughordinaryshares
ii.Rs.10,00,000throughordinarysharesandresthrough8%longtermloan [7M]
Page1of3
6. (a)Brie?yexplainEBIT?EPSAnalysis [7M]
(b)Calculatetheoperatingandcombinedleverageforthefollowingdata: [7M]
i.Sales5,00,000unitsatRs.10perunit
ii.VariablecostperunitRs.3.50
iii.FixedchargesRs.5,00,000
iv.InterestchargesRs.20,000
UNIT?IV
7. (a)Whatdoyoumeanbydividendpolicy?Explainindetailtheformsofdividend. [7M]
(b)HyderabadPaperMillsLtd. belongstoariskclassforwhichthecapitalizationrateis10%.
Thecompanyhascurrently50,000sharessellingatRs. 100each. Thecompanyisplanningto
declareadividendofRs. 5pershare. ThecompanyisexpectingtohaveanetincomeofRs.
5,00,000andhasaproposalformakingnewinvestmentsofRs.10,00,000.ShowthatunderMM
assumptions,thepaymentofdividendsdoesnota?ectthevalueofthe?rm. [7M]
8. (a)Whatisstabledividendpolicy?Explain. [7M]
(b)GenesisIndiaLtd.,havingearningearningsofRs.10pershareiscapitalizedatarateof15%and
hasarateofreturnoninvestmentof20%.Whatwouldbethepricepershareat25%dividend
payoutratioaccordingtoWalter?smodel? [7M]
UNIT?V
9. (a)WhatisWorkingCapital?Discussdi?erentprinciplesofWorkingCapital. [7M]
(b)ExonLtd,hascurrentsalesofRs. 6,00,000perannum. TopushthesalesExonconsideringa
moreliberalcreditpolicyasoneofthestrategies. Thecurrentaveragecollectionperiodofthe
companyis30days. Proposedincreaseinthecollectionperiodandtheirimpactonsalesare
giveninTable1.ExonissellingtheproductatRs.10each.Averagecostperunitatthecurrent
levelisRs. 8andvariablecostperunitisRs. 8andvariablecostisRs. 6. IfExonrequiresa
rateofreturnof20%onitsinvestments,whichcreditpolicywillyourecommend? Assume360
daysayear. [7M]
Table1
CreditPolicy Increaseincollectionperiod Increaseinsales Defaultrate
I 15days Rs.25,000 0.5%
II 30days Rs.60,000 1.0%
III 40days Rs.70,000 2.0%
Page2of3
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HallTicketNo QuestionPaperCode:CMB008
.
.
MBAIISemesterEndExaminations(Supplementary)-December,2018
Regulation: .?R16
FINANCIALMANAGEMENT
Time: 3Hours (MBA) MaxMarks: 70
AnswerONEQuestionfromeachUnit
AllQuestionsCarryEqualMarks
Allpartsofthequestionmustbeansweredinoneplaceonly
UNIT?I
1. (a) WhatisFinancialManagement?Explainany?veobjectivesofFinancialManagement? [7M]
(b) Assumetheinterestratetobe12%.Computetheannualpercentage/e?ectiverate,iftheperiod
is:(i)Annual(ii)Semiannual(iii)Quarterly [7M]
2. (a) Di?erentiatepro?tmaximizationandwealthmaximization [7M]
(b) XinvestsRs.1,000for3yearsinasavingsaccountthatpays10%interestperannum.Calculate
thefuturevalue. [7M]
UNIT?II
3. (a) ExplainindetailanyfouradvantagesandthreedisadvantagesofNPVmethod. [7M]
(b) 20years20%debenturesofa?lmaresoldatarateofRs.180.Thefacevalueofthedebentures
isRs.200,50%taxisassumed.Findthecostofdebt. [7M]
4. (a) ExplaintheprocedureofWeightedAverageCostofCapital(WACC). [7M]
(b) You are given with the following information relatingtoABC Ltd., forthe yearsofrecent
performanceofanasset. Initialcashoutlay?Rs. 50,000;lifeoftheasset?5years;estimated
annualcash?ow?Rs.12,500.CalculatetheIRRinbetween10%and15%D.F. [7M]
UNIT?III
5. (a)WhatisCapitalStructure?Discussanysixfactorsa?ectingCapitalStructure. [7M]
(b)OrientalLimitedcurrentlyhasordinarysharecapitalofRs.25,00,000consistingof25,000equity
sharesofRs. 100each. Thecompany?sEBITisRs. 8,00,000. AssumingCorporatetaxrate
as50%. Themanagementisplanningtoraiseanother20,00,000to?nancemajorexpansion
programme,throughoneofthefourpossible?nancialplans.Commentwhichofthealternateis
thebestandwhy?
i.Entirelythroughordinaryshares
ii.Rs.10,00,000throughordinarysharesandresthrough8%longtermloan [7M]
Page1of3
6. (a)Brie?yexplainEBIT?EPSAnalysis [7M]
(b)Calculatetheoperatingandcombinedleverageforthefollowingdata: [7M]
i.Sales5,00,000unitsatRs.10perunit
ii.VariablecostperunitRs.3.50
iii.FixedchargesRs.5,00,000
iv.InterestchargesRs.20,000
UNIT?IV
7. (a)Whatdoyoumeanbydividendpolicy?Explainindetailtheformsofdividend. [7M]
(b)HyderabadPaperMillsLtd. belongstoariskclassforwhichthecapitalizationrateis10%.
Thecompanyhascurrently50,000sharessellingatRs. 100each. Thecompanyisplanningto
declareadividendofRs. 5pershare. ThecompanyisexpectingtohaveanetincomeofRs.
5,00,000andhasaproposalformakingnewinvestmentsofRs.10,00,000.ShowthatunderMM
assumptions,thepaymentofdividendsdoesnota?ectthevalueofthe?rm. [7M]
8. (a)Whatisstabledividendpolicy?Explain. [7M]
(b)GenesisIndiaLtd.,havingearningearningsofRs.10pershareiscapitalizedatarateof15%and
hasarateofreturnoninvestmentof20%.Whatwouldbethepricepershareat25%dividend
payoutratioaccordingtoWalter?smodel? [7M]
UNIT?V
9. (a)WhatisWorkingCapital?Discussdi?erentprinciplesofWorkingCapital. [7M]
(b)ExonLtd,hascurrentsalesofRs. 6,00,000perannum. TopushthesalesExonconsideringa
moreliberalcreditpolicyasoneofthestrategies. Thecurrentaveragecollectionperiodofthe
companyis30days. Proposedincreaseinthecollectionperiodandtheirimpactonsalesare
giveninTable1.ExonissellingtheproductatRs.10each.Averagecostperunitatthecurrent
levelisRs. 8andvariablecostperunitisRs. 8andvariablecostisRs. 6. IfExonrequiresa
rateofreturnof20%onitsinvestments,whichcreditpolicywillyourecommend? Assume360
daysayear. [7M]
Table1
CreditPolicy Increaseincollectionperiod Increaseinsales Defaultrate
I 15days Rs.25,000 0.5%
II 30days Rs.60,000 1.0%
III 40days Rs.70,000 2.0%
Page2of3
10. (a)Discussthesourcesof?nanceformeetingworkingcapitalrequirement. [7M]
(b)Therelevant?nancialinformationforXavierLimitedfortheyearended2011isgivenbelow.
Whatisthelengthoftheoperatingcycleandcashcycle? Assume365daysayear. Sales: Rs.
80million [7M]
Costofgoodssold:Rs.56million
Inventory(beginningoftheyear)Rs.9millon
Inventory(endoftheyear)Rs.12millon
AccountsReceivables(beginningoftheyear)Rs.12millon
AccountsReceivables(endoftheyear)Rs.16millon
AccountsPayables(beginningoftheyear)Rs.7millon
AccountsPayables(endoftheyear)Rs.10millon
? ? ? ? ? ? ?
Page3of3
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