B.Com. LL.B. (Five Years) Sem 4 Financial Management 2012 Jan Question Paper - KSLU

Questions asked in this paper

UNIT - I

1. Q1 (a) Following are the details of ENKAY Ltd.
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2. Q1 OR Manu Ltd. has the following capital structure :
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3. Q1 (b) Write a short note on Sharpe Lintner Model.
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4. Q1 OR Write a short note on empirical evaluation of a model.
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UNIT - II

1. Q2 (a) Mr. Bean has a company which belong to a risk class for which the appropriate capitalisation rate is 10%. It currently has outstanding 25,000 shares selling at ₹ 100 each. The firm is contemplating the declaration of a dividend of ₹ 5 per share at the end of the current financial year. The company expects to have a net income of ₹ 2,50,000 and has a proposal for making new investments of ₹ 5,00,000. Show that under the MM assumptions, the payment of dividend does not affect the value of the firm.
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2. Q2 OR Define "dividend policy" and explain its nature. Explain the types of dividend policy with examples. What are the objectives of dividend policy ?
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3. Q2 (b) What are the factors that influence the dividend policy ?
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4. Q2 OR Write a short note on traditional proposition of dividend policy.
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UNIT - III

1. Q3 (a) The board of directors of Ram Engineering Ltd. request you to advise them the average amount of working capital required in the first year's working. You are given the following estimates and are instructed to add 10% to your computed figure to allow for contingencies.
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2. Q3 OR Define working capital. What are the different classification of working capital ? What are the merits and demerits of working capital ?
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3. Q3 (b) Explain any 2 inventory techniques being adopted by business concerns.
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4. Q3 OR Write a short note on working capital cycle.
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UNIT - IV

1. Q4 (a) A company is considering an investment proposal to install new machine at a cost of Rs. 50,000. The facility has a life of 5 years and no salvage value. The tax rate is 35%. Assume the firm uses straight line depreciation for tax purposes.
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2. Q4 OR XYZ Company Ltd. has got ₹ 20,000 to invest. The following proposals are under consideration.
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3. Q4 (b) What do you understand by a capital budgeting decision ? Why is capital budgeting so important to management ?
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4. Q4 OR Write a short note on managing finance in multinational corporations with examples.
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UNIT - V

1. Q5 (a) Girish Ltd. acquires Suresh Ltd. for a consideration of Rs. 76,00,000 to be satisfied in the form of fully paid equity shares of ₹ 10 each. The balance sheets of the two companies on 31-12-2010, the date of acquisition were as follows :
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2. Q5 OR Priya Ltd. wants to take over Ram Ltd. and the financial details of both the companies are as below.
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3. Q5 (b) What are the characteristics of Mergers and Acquisitions ?
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4. Q5 OR Explain the reasons for mergers and acquisitions.
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Typed from the KSLU paper above. The paper is the original. Long reading passages are shortened here to their first and last lines and a summary.