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

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B.B.A. (SEMISTER – V) EXAMINITION – 2007
LONG TERM FINANCE
(Spécialisation: II)
TIME : three HOURS [ MAX .MARKS : 80
INSTRUCTIONS : 1] ques. NOS one AND two COMPULSORY
2] OUT OF THE REAMINING SOLVE AANY TWO
ques.
3]ALL ques. CARRRY EQUAL MARKS


Q1) A company has subsequent capital structure :
12% debentures (of Rs 100 each) 20,00,000
reserves and surplus 10,00,000
equity share capital
(shares of Rs 50 every ) 25,00,000
_________
55,00,000


company has earned operating profit of Rs 10 lakhs.
the market price per share is Rs 60 and per debentures is Rs 95. tax rate is 40% .

1)what is earning per share ?

2)what is percentage cost of capital to the company for the debentures funds and equity ?

Q2) Write short notes on: (Any 4 )

a)Over capitlaisation and under capitalization
b)lease financing
c)replacement of capital assets
d)public deposits
e)ploughing back of profits
f)types of preference shares

Q3) (A) describe the term ‘cost of capital’ and state elements in cost of capital .

(B) Distinguish ranging from owened funds and borrowed funds .

Q4) (A) discuss different factors affecting ‘capital structure’

(B)What is ‘financial Plan’ ? discuss principles for formulation of ‘financial plan’.

Q5) (A) elaborate the risks involved in ‘capital budgeting’ ?

(B) discuss in detail ‘trading on equity’ and ‘capital gearing’

Q6) (A) provide detailed note on sources available for ‘short term finance’.

(B) Distinguish ranging from ‘equity shares and ‘debentures’.

Earning:   Approval pending.