COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES

Week No: __,

Trimester:3 rd AY 2020-2021
Home Work NO. _2__
MARKS

COURSE CODE BSIB525 COURSE TITLE Financial Management

SECTION TIME DAYS ROOM
STUDENT NAME ID NO. DATE

TOPIC
Capital Budgeting Decision making

ASSIGNMENT Question:
DIRECTION & 1. A project requires on initial investment of 70000 with a useful life
REQUIREMENT/S
(Identify the ILOs to of 5 years .The projected P+L a/c discloses a profit after tax
be assessed at the Rs.10,000 every year .What is the payback period?
end of each
requirement. Include
the rubric or marking 2. A project require an initial investment 35000 and generates the
scheme for each
item/requirement.) following CFs in 5 years.

Year 1 2 3 4 5
CFs 5000 6000 16000 3000 10,000
Calculate payback period

(Marking: 5 mark on each short questions of 10 marks)

           
Instructions:
Guidelines:
1. This is an individual assignment which every student has to submit.
2. Try to answer the question based on how it asked to do.
3. Write your section, student id, class time, date and name, in the space
allotted above.
4. Attach your answers in A4 MS word format along with this template.

ASSIGNMENT
OUTPUT
Q1:

Given
 COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES
Week No: __,
Trimester:3 rd AY 2020-2021
Home Work NO. _2__
MARKS

COURSE CODE BSIB525 COURSE TITLE Financial Management

SECTION TIME DAYS ROOM
STUDENT NAME ID NO. DATE

Initial Investment = 70,000

Useful Life = 5 years

Profit every year = 10,000

Calculation of Pay Back Period = Initial Investment/Annual Cash Flows

= 

= 7 years.

Q2:

Here we have given initial investment as 35000

The cash inflows for the period of 5 years provided in the question were not equal
[uneven].

So we were required to find the "Cumulative cash flow"

The recovery year will be considered as 'n'

Formula:

Year CF (Cash Flow) Cumulative CF (Cash Flow)

0 (35000) (35000)

1 5000 (30000)

2 6000 (24000)

3 16000 (8000)

4 3000 (5000)
 COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES
Week No: __,
Trimester:3 rd AY 2020-2021
Home Work NO. _2__
MARKS

COURSE CODE BSIB525 COURSE TITLE Financial Management

SECTION TIME DAYS ROOM
STUDENT NAME ID NO. DATE

5 10000 5000

Payback period:

Step 1:
Consider the year that has the final negative outflow,

So it is in the 4th year.
Step 2:

= 0.5
Step 3:
Payback period = Step 1 + Step 2

= 4 + 0.5

Payback Period = 4.5 Years

 COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES
Week No: __,
Trimester:3 rd AY 2020-2021
Home Work NO. _2__
MARKS

COURSE CODE BSIB525 COURSE TITLE Financial Management

SECTION TIME DAYS ROOM
STUDENT NAME ID NO. DATE

RUBRIC /
MARKING 10= Details are fully complete and demonstrate deep understanding of content
8= Answer is acceptable but lacks minor details
SCHEME 6= Answer is responsive but not fully complete
3= Major details are missing and shows low level of understanding of the content
1 = Answer is lacking multiple major details
0 = Question in not answered or answer given is inappropriate

LEARNING ASSESSMENT/MARKING FACULTY/MARKER’S FEEDBACK

ITEM CILOs MARKS MARKS AWARDED
Capital C4 10
Budgetin
g
 COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES
Week No: __,
Trimester:3 rd AY 2020-2021
Home Work NO. _2__
MARKS

COURSE CODE BSIB525 COURSE TITLE Financial Management

SECTION TIME DAYS ROOM
STUDENT NAME ID NO. DATE

TOTAL