University of Pune 2007 B.B.A LONG TERM FINANCE(Specialisation – II) - Question Paper

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B.B.A. (SEMISTER – V) EXAMINITION – 2007
LONG TERM FINANCE
(Specialisation – II)
TIME : three HOURS [ MAX .MARKS : 80
INSTRUCTIONS : 1]Question nos one and two are compulsory.
2] Out of the remaining solve any 2 ques.
3] all ques. carry equal marks.
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Q1) XY LTD. has subsequent capital structure :
Rs
12% debentures (of Rs 100 every ) 40,00,000
reserves and surplus 20,00,000
equity share capital
( shares of Rs 50 every ) 50,00,000
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1,10,00,000




company has earned operating profit of Rs 20 lakhs.
the market price share Rs 60 and per debentures Rs 95 tax rate is 40%.
(a)what is earning per share ?
(b)what is percentage cost of capital to the company for the debenturefunds and equity ?


Q2) Write short notes on : (any four)
a)Public deposits
b)ploughing back of profits
c)types of preferences shares
d)leverages
e)hire purchasing
f)borrowed funds

Q3) (A) Distinguish ranging from own funds and borrowed funds.
(B) describe the term ‘financial plan’. discuss the principles for formulation of financial plan.

Q4) (A) provide detail note on :
debentures and Term loan – as sources of long term finance.
(B) elaborate the risks involved in capital budgeting ?

Q5) (A) Distinguish ranging from over capitalization and under capitalization.
(B) elaborate capital structure ? explain different factors affecting capital structure .


Q6) (A) discuss the methods of replacement of capital assets.
(B) What is meant by operating leverages ? how does it help in magnifying the revenue of the company ?

Earning:   Approval pending.