Pondicherry University 2008 B.C.A Computer Application , FINANCIAL MANAGEMENT - Question Paper

B.C.A DEGREE EXAMINATION, NOVEMBER 2008.
Third semester

COMPUTER APPLICATIONS

Allied- FINANCIAL MANAGEMENT

PART-A (10 *2=20 MARKS)

ans ALL THE ques..

1. What is money market?

2. State any 2 functions of SIDBI.

3. Define the term ‘secondary market’.

4. Who is a bull in stock exchange?

5. Point out any 2 basis for credit rating.

6. Bring out the meanings, for the term forfeiting.

7. Make a short note on earning per share (EP).

8. Write down any 2 aims of financial management.

9. Draw the operating cycle.

10. Pen down any 2 techniques of optimum cash management.



PART-B (5*6=30 MARKS)

ans ANY 5 ques.

11. explain the characteristic features of Indian money market.

12. Trace out the investment policies of UTI.

13. discuss the functioning of secondary market.

14. Narrate the differences ranging from financial lease and operating lease.

15. a company problems 10 % irredeemable preference shares. The face value per share is Rs. 100 but the problem price is Rs.95. what is the cost of preference? What is the cost if the problem price is Rs.105?

16. An equipment a has cost Rs.75, 000 and net cash flow of Rs.20, 000 per year for 6 years. A substitute equipment B would cost Rs. 50,000 and generate net cash flow of Rs. 14,000 per year foe 6 years. The needed rate of return on both equipments is 11% compute IRR and NPV for every equipment. Which equipment should be accepted?

17. compute EOQ and frequency of orders form the subsequent information:
Annual usage-600 units, cost of placing, order-Rs 12, Price of material per unit – Rs 20, cost of storage-20%

18. Hansa steel tube limited is considering whether or not to go to a Lock-box system for cash management. The cost of the system is expected to be Rs.1.25 per cheque. The avg. cheque size will be Rs.5, 000. The firm can invest the funds received earlier by using the lock-box system in the money market instruments earning a rate of 8% per annum. How much should be the reduction in the cheque collection time for Hansa to be able to accept the decision about the lock-box?


PART-C (5*10=50 MARKS)

ans ALL ques..

19. (a) define the functions of commercial banks.

Or
(b) Enumerate the functions of Reserve Bank of India.

20. (a) Enumerate the features and advantages of OTCEI

Or

(b) discuss the SEBI guidelines pertaining to Primary Market.

21. (a) elaborate the advantages of Forfeiting? How forfeiting differs from factoring?

Or
(b) describe venture capital. explain the stages involved in the venture capital.

22. (a) From the subsequent particulars relating to the capital structure of Dell Ltd. compute the overall cost of capital using:
(i) Book value weights; and
(ii) Market value weights.

Source of funds Book value
(Rs.) Market value
(Rs.) After tax
cost
Equity share capital 45,000 90,000 14%
Retained earning 15,000 90,000 13%
Reference share capital 10,000 10,000 10%
Debentures 30,000 30,000 8%

Or

(b) explain the various traditional and discounted cash flow techniques of capital budgeting.


23. (a) What is inventory management? Elucidate the different techniques of inventory management.
Or
(b) the management of Gemini ltd has called for a statement showing the working capital needed to finance a level of activity of 3,00,000 units of out put for the year. The cost structure for the company’s product, for the above mentioned level is detailed below:

Particulars Cost per unit
(Rs.)
Raw materials

Direct labour

Overheads

Total cost

Profit

Selling price 20

5

15

40

10

50
Past patterns indicate that raw materials are held in stock, on an average, for 2 months. Work-in-progress will approximate to half a month’s production. Finished Goods remain in ware house, on an average, for a month. Suppliers of material s extended a month’s credit. 2 month’s credit is normally allowed to debtors. A minimum cash balance of Rs. 25,000 is expected to be maintained. The production trend is presumed to be even during the year. Prepare the statement of working capital determination.

__________

Earning:   Approval pending.