Financial Management Question Paper Nov - Dec' 2013, Dibrugarh University M.Com Final Year (Distance)

Financial Management Question Paper’ 2013
Dibrugarh University M.Com Final Year (Distance)
Paper: 201
Marks: 80
Time: 3 Hours

1. (a) Give an overview on evolution of financial management.       16

Or

(b) Elucidate the assumptions underlying the financial objectives.            16

2. (a) From the following balance sheet of A ltd. Prepare a comparative balance sheet with comments.

Liabilities	2012	2013	Assets	2012	2013
Share capital	600000	600000	Fixed assets	500000	800000
Equity share capital	nil	400000	Less: Depreciation	67000	80000
				433000	720000
General reserve	57500	90000	Investment(at cost)	50000	80000
Profit and loss	80000	82000	Stock	120000	300000
8% debenture	75000	50000	Debtor	200000	239000
Bank loan	25000	200000	Bank	80000	120000
Creditor	25000	50000	Cash	17000	37000
Outstanding expenses	7500	3000
Provision for tax	30000	21000
	900000	1496000		900000	1496000

Or

(b) Why is it necessary to calculate the profitability ratio in relation to sales? Illustrate your answer. 16

3. (a) The AB industries Limited has 900000 shares outstanding at current market price of Rs.130 per shares. The company needs Rs.225 crores to finance proposed modernisation cum expansion project. The board of company has decided to issue rights for raising the required money. The subscription (issues) price has been fixed at Rs. 75 per shares. The subscription price has set below the market price to ensure that the right issue is fully subscribed. How many rights required to purchase a new share? What is the value of a right?                   16

Or

(b) How does a term loan differ from a non- convertible debenture?

4. (a) In addition to trade credit, accrued expenses and deferred income are other spontaneous source of short term financing. Justify your answer.     16

OR

(b) Illustrate captive finance companies in relation to short term financing.             16

5. (a) elucidate the players in derivates trading and the functions of future markets.              8+8

OR

(b) How for over the counter exchange of India is able to fulfill the needs of the small companies.     16