M.B.A ( 2019 PATTERN ) Finance

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Total No. of Questions : 5] SEAT No.

PA-4348 [Total No. of Pages : 4


[5946]-2002
M.B.A.
GC-08 : FINANCIAL MANAGEMENT
(2021 Pattern) (Semester - II) (202)

Time : 2½ Hours] [Max. Marks : 50


Instructions to the candidates :
1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Use of simple calculator is allowed.

Q1) Fill in the blank with appropriate choice. (Any 5) [10]


i) The objective of Financial Management is ________.
a) Profit Maximisation b) Wealth Maximisation
c) Maximising EPS d) Return on Capital Employed
ii) Financial Management is concerned with _______.
a) raising of fund b) investment of fund
c) dividend decision d) all of the above
iii) Ideal Current Ratio is _______.
a) 1:1 b) 2:1
c) 3:1 d) 1.5:1
iv) In the computation of liquid ratio excluded from the current Asset is
_______.
a) cash in Hand b) bank Balance
c) accounts receivable d) inventory
v) Internal rate of return is the rate of return at which the net present value
is ________.
a) Positive b) Negative
c) Zero d) None of the given

P.T.O.
vi) Capital budgeting is ______.
a) Preparing a capital expenditure budget
b) Planning Capital expenditure
c) Planning and evaluation of capital expenditure
d) Planning of expenditure
vii) Capitalisation means ________.
a) amount of equity capital b) amount of debt
c) total amount of capital d) retained earning
viii) The amount of working capital which changes according to seasonal
fluctuation is called as ______.
a) fixed working capital b) net working capital
c) gross working capital d) fluctuating working capital

Q2) Write short note on : (Any 2) [10]


a) Financial Forecasting
b) Utility of Fund Flow statement
c) Internal Rate of Return
d) Operating Cycle

Q3) a) Jayesh Manufacturing Company Ltd. Submits the following balance


sheet as on 31st March 2022
Balance Sheet As on 31/03/2022
Liabilities < Assets <
Share Capital 2,00,000 Land & Building 1,40,000
Profit & Loss A/c 70,000 Plant & Machinery 3,50,000
12% Debentures 4,20,000 Stock in trade 2,00,000
Creditors 1,00,000 Debtors 1,10,000
Bills payable 50,000 Bank 40,000
8,40,000 8,40,000

[5946]-2002 2
Calculate : [10]
i) Current Ratio
ii) Quick Ratio
iii) Debt to Equity
iv) Inventory to working capital
v) Current Asset to fixed Asset
OR
b) Differentiate between Cash Flow statement & Fund Flow Statement.

Q4) a) Gatha Ltd. is considering investing in a project that is expected to cost


` 12,00,000 and has an effective life of 5 years. The project cash
inflows for this period are as follows :
Year Amount
1 3,00,000
2 3,00,000
3 4,50,000
4 4,50,000
5 7,50,000
Total 22,50,000
Calculate : [10]
i) Net Present Value @ 10% rate of discount
ii) Profitability Index
OR
b) From the following information of PGK Ltd. Calculate,
i) Operating Leverage
ii) Financial Leverage
iii) Combined Leverage
Particulars <
Interest 5,000
Sales 50,000
Variable Cost 25,000
Fixed Cost 15,000
[5946]-2002 3
Q5) a) Swaraj Ltd. is about to commerce a new business and finance has been
provided in respect of fixed assets. They asked your advice about the
working capital management of the company. The following
information is available for your information : [10]
Particulars Avg. Credit Estimate for
Period a year
Purchase of Material 6 weeks 26,00,000
Wages 1.5 Weeks 19,50,000
Overhead :
Rent 6 months 1,00,000
Managers Salary 1 Month 3,60,000
Office Salary 2 Weeks 4,55,000
Commission 3 Months 2,00,000
Other Overhead 2 Months 6,00,000
Cash Sales - 1,40,000
Credit Sales 7 Weeks 65,00,000
Avg. Amount of
stock & WIP - 3,00,000
Calculate the working Capital requirement for Swaraj Ltd.
OR
b) Myra Ltd. has the following capital structure
Sources <
Equity Share Capital (20000 shares) 4,00,000
6% Preference Shares 1,00,000
8% Debentures 3,00,000
The market Price of the equity shares is < 20 per shares, the expected
Dividend is < 2 per shares and the growth rate is 7%. The Rate of Tax
is 40%. Calculate WACC.

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[5946]-2002 4

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