Bharathidasan University 2006 FINANCIAL MANAGEMENT - Question Paper
SMo. 5306 BBL
(Pot cmndxUtM admitted from 1996 oowards)
B.B A DEGREE EXAMINATION. APRIL 2006 Part III Buiumm Adminutratoa Mi)or FINANCIAL MANAGBMENT Tin*: Three hours Mmmum: 100 marka
SECTION A (10x2-20)
Arawer ALL questions
1. Explain the nature of finance function.
2- What are the goal* of financial management'*
5. Define marginal coat of capital.
4. What do you moan by leverage7
6. What do you moan by trading on equity?
& What do you understand by a balanced capital structure of a fins?
7. Do fin* pay bade period
8. What do you understand by capital budgeting decision*
9. What to forvcatung*
10. Write the menu of IRR method?
SECTION B-(5x6. JO)
Answer the followinf question*.
11. (a) Writ* a comprehensive not* o the objectives of a Arm from financial point of view.
Of
(b) Examine the rot* of financial management in
12. (a) Explain the coocept of coat of capita]. What is it* importance?
Or
<b) How would you measure the coat of capital in making investment dedsuos?
13. (a) Explain the importance of optimum capital structure of a firm Dtacnbe Us characteristics.
Or
(b> Define capital fearing When a company be said to be highly geared or low geared7
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14. (a) What do you mean by Economics of capital Budgeting? Explain briefly.
Or
(b) A concern is considering two project* X and Y. Following are the particular* in reaped of them:
|
Project X |
Project Y | |
|
Coat (Rs) |
1.40.000 |
1,40.000 |
|
Economic Life (in yean) |
10 |
10 |
|
Estimated Scrap (in Rs.) |
10.000 |
14.000 |
|
Annual savings |
29.000 |
20.000 |
Ignoring income-tax, recommend the beet of these project* using (i) pay-back penod (ii) poet pay-back profit and (iii) Index of post pay-back profit.
15. <a) Define Financial Planning and discuss its various aspect*.
Or
(b) What consideration* would you keep in mind while drafting a financial plan for industrial concerns?
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SECTION C-(5x10-GO)
Axurwer ALL questions.
16. (a) How will you organise your department in the capacity of financial manager?
Or
(b) Explain the concept of profit maximisation and wealth maximisation.
17. (a) What is meant by weighted average coat of capital? What is the utility of computing weighted average coat of capital?
Or
(b) The Xavier corporation, a dynamic growth firm which pays no dividends, anticipate* a long ran level of future earning of Rs. 7 per share. The current price of Xavier's shares is Rs. 55.46 ; floatation costs for the sales of equity sharee would average about 10% of the price of the shares What is the cost of new equity capital to Xavier?
18. (a) Explain the advantages and limitations of trading on equity.
Or
(b) Describe the necessity of change* in capital structure of a firm
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19. (a) What ia peaal value method? How m profitability of various capital projects ovaluatad under this method?
Or
fb) Pay off Ltd is producing activities mostly by manual Labour and is coosidenng to replace it by a Dew machine. Prepare a statement of profitability showing the payback pened from the following information :
Machine A Machine B Estimated life of machine 4 years 6 yean
Cost of the machine
Estimated savings in scrap
Estimated savings in direet wags*
Additional cost of
Additional cost of supervision Ignore Taxation
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20. (a) giplain the tool* of fimwui foreeartuif.
Or
(b) Explftw tb* (melon inflo*nan fioancud planning
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Attachment: |
| Earning: Approval pending. |
