Post Graduate Diploma-Post Graduate Diploma Business Management 2nd Sem 202 : FINANCIAL MANAGEMENT(University of Pune, Pune-2013)
P.G.D.B.M. (Semester – II) Examination, 2013
202 : FINANCIAL MANAGEMENT
(2008 Pattern)
Time : 3 Hours Total Marks : 70
Instructions :
1) Question No. 1 is compulsory and carries 10 marks.
2) Attempt any two from each Section and carry 15 marks each.
3) Use of simple calculator is allowed.
SECTION – I
1. Explain the various forms of business organizations.
2. Explain the methods for evaluating capital expenditure proposals.
3. What is over capitalization ? State the reasons for the same. How would you overcome the over capitalization ?
4. Write short notes (any three) :
a) Credit rating
b) Commercial papers
c) Hire purchase
d) Receivables management
e) Bonus shares.
SECTION – II
5. The management of Vijay Ltd. has called for a statement showing the working capital needed to finance a level of activity of 3,00,000 units of output for the year. The cost structure for the company is as follows :
Cost per unit Rs.
Raw material 30
Direct labour 15
Overheads 15
Total cost 60
Profit 20
Selling Price 80
Past trends indicates that raw materials are held in stock on an average for two months. Work-in-progress (50% complete) will approximate to half-a-month’s production. Finished goods remain in warehouse on an average for a month. Suppliers of materials extend a month’s credit. For debtors two months credit is usually allowed. A minimum cash balance of Rs. 50,000 is expected to be maintained. The production pattern is assumed to be uniform throughout the year. Prepare the statement of working capital determination.
6. Calculate Operating Leverage, Financial Leverage and Combined Leverage from the following information.
Particulars Amt (Rs.)
Sales 6,00,000
Variable cost 3,00,000
Contribution 3,00,000
Fixed cost 2,00,000
Earning before
Interest and tax 1,00,000
Interest 50,000
Earning before tax 50,000
| Earning: ₹ 7.05/- |
