CBCS(5S)DC — Com (CC — 12) 2022 Time : 3 hours Full Marks : 80 The figures in the right-hand margin indicate marks. Answer from all the Groups as directed. Group-A 4. Fillin the blanks : 1%12=12 (a) Profit maximisation objectives ignore the value of money. (b) Time value of money received today is ——___—_ than the value of money received after a certain period. (c) Risk refers to a situation where there is possibility of (d) There are two types of corporate securities, one is ownership securities and the other is TW-66/3 (Tur over)(©) Cost of retained earings is the Cost of dividends foregone by the share holders. () Profitability index is also known as ratio. () dividend promises to pay the shareholders at a future date. (h) Net working capital is the excess of current assets over : ()_ The rate of retum on investments with the shortage of working capital. @ §.0.Q. stands for (Kk) —_____ level is the level beyond which quantity of material should not fall in any case. ()._ The simplest capital budgeting technique is Group-B Answer any eight of the following questions in ‘not more than three sentences each : 2x8 = 16 (2) Whatis gross working capital ? TW-66/3 (2) Contd. ee (b) What is meant by factoring ? (c). What do you mean by tisk ? (d) What is equity share ? (e) What is capital rationing ? () Name the areas of finance function. (g) What do you mean by annuity ? (h) What is meant by ploughing back of profits 7 (i) Define capital budgeting. () What is composite cost of capital ? Group-¢ Answer any eight of the following questions : 3x8 = 24 (a) Whtais a cash budget ? (0) Write a short note on lease financing. (©) What is financial management process ? (d) How is the cost of zero coupon bonds determined 7 TW-66/3 (3) (Tum over)(©) What are the kinds of working capital ? Assuming that a firm pays tax at 50% rate, (Explain danger level of inventories, Compute the after tax cost of debt capital in the (9) What i t by dividend policy ? fon canes is mean ol Reley, (2) Aperpetual bond sold at par coupon rate of (h) Explain the term stock dividend. interest being 7%. () What are the limitations of capital (b) A10 years, 8% Rs. 1,000 per bond sold at budgeting 7 | Rs. 950 less 4% under writing commission. © Why's maximising wealth a better goal than 6. Explain the various factors which influence the maximising profit 2 dividend decision of a firm. OR j Group -D Prepare an estimate of working capital i Answer all questions of the following: 7x4 = 28 requirement from the following information of a trading concer : 4. What do you mean by Financial M 2 ae nen (@) Projected annual sales — 100,000 units Explain its objectives. (b) Selling price — Rs. 8 per unit OR (©) Percentage of net profit on sales — 25% | What is risk ? Briefly explain the types of risk (d) Average credit period allowed to customers | involved in an investment. —8 weeks (e) Average credit period allowed by suppliers 5. Explain the advantages of ploughing back of —f weal Brotie ao a gource of finance. (9 Average stock holding in terms of sales | OR requirement — 12 weeks | (@) Allow 10% for contingencies | TW-66/3 (4) Contd, TW-66/3 (5) (Tum over)7. Define working capital. What factors would you take into consideration in estimating the working capital needs of a concern ? OR Compute the payout ratio and the retained earings ratio from the following data : Number of equity shares — 3,000 Dividend per equity share — Rs. 0.40 Net profit — Rs. 10,000 Provision for tax — Rs. 5,000 Preference dividend — Rs. 2,000 Me % TW- 66/3 (400) (6) CBCS(5s)DC — Com (CC — 12)