Advanced Financial Management Question papers

Note : Section I :- All Questions are Compulsory (30 marks)

Section II :- Attempt any three. (30 marks)

Section I

Q.1 a) Each Question of 1 Mark (5C x 1M = 5M)

i) Explain Non-Core Asset

ii) 2/10 Net 60

iii) RTGS

iv) Formula of cost of redeemable debt

v) Explain ‘Capital Market Conditions’ as a factor determining capital structure

Q.1 b) Each Question of 5 Marks. Attempt any two. (5 x 2 = 10 Marks)

(i) Given below is Balance Sheet of A Ltd.



ESC (Rs.10 / Share)

10% Preference Shares

8% Debentures



Sundry Assets


1) If ROI is 18% and Tax rate is 40%,


a) DFL b) EPS c) DOL

Company’s assets turnover ratio is 0.6 and the P/V ratio is 33.33% (1/3)

(ii) XYZ Ltd. is planning to acquire PQR Ltd. Since the current EPS is $ 5 for the ABC Company, the management is keen to get EPS of $ 6 at least post merger. They seek your advice on the possible exchange ratio that would give the merged entity an EPS of $ 6. It is also provided that the acquisition would result in a synergy of 200 Lakh. The following financial data is given:


XYZ Ltd.

PQR Ltd.


No. of Shares

Market Price

$ 5

200 Lakh

$ 100

$ 4

80 Lakh

$ 70

(iii) Capital Structure


(70, 000 sh. of $ 10)

10% Preference

15% Debt

7 Lakh

1.75 Lakh

12.25 Lakh

21 Lakh

Expected Profit after tax is $ 577500

Stock price today (Po) = $ 32/-

Tax @ 40%

Calculate WACC.

Q.2) Amruta Enterprises (having installed capacity of 2, 00, 000 units p.a.) produced 1, 00, 000 units in the financial year 2010 – 2011. The cost – structure in 2010 – 2011 was as under :






Raw Materials


Factory Overheads

Administrative and Selling Overheads

Total Cost


Selling Price







The selling price, which was $ 500 per unit in 2010 – 11, is estimated to be fixed as at $ 600 per unit for the year 2011 – 12; and production & sale expected to increase by 40, 000 units. It is, further, anticipated that raw materials cost per unit would increase by 10% due to price rise, whereas wage rate per unit would decrease by 20% due to automation. 56% of all the overheads are fixed and balances are variable. As a Management Accountant, you are required to prepare (a) Cost Statement for the year 2011 – 12 & (b) Statement showing estimated working capital required for the year 2011 – 12 after considering the following additional information :

(a) Raw Materials stock equivalent to two & half month’s consumption would be stored.

(b) Production time is one month. Raw materials are introduce at the beginning of the process, whereas wages and factory overheads accrue evenly during the production period.

(c) Two months stock of finished goods (Valued at factory cost) would be carried in stock.

(d) 20% of raw materials would be imported from China an advance payment of two months would be made there against. 15% of indigenous raw materials requirement would be procured locally against immediate cash payment. Suppliers of balance of indigenous raw materials, allow a credit of one month.

What do you think this job would pay?

2010-08-26 23:34:43 by -

Client Services Manager
The ideal candidate will have financial services experience, be a self starter, have a positive attitude and a strong willingness and desire to take ownership of an important set of firm responsibilities.
Job Summary:
The Client Services Manager will be the first point of contact for all clients when they call or visit the office. This position is responsible for determining how to best assist clients and ensuring that solutions are provided in a professional manner. The position entails a wide variety of responsibilities including client service and onboarding, office management, administration, marketing support and other special projects

In Defense...continued

2002-01-02 14:43:17 by justyouraveragecitizen

But a participatory economy enjoys advantages in managing this trade off compared to capitalism. Most importantly, direct recognition of 'social serviceability' is a more powerful incentive to innovation in a participatory economy, which reduces the magnitude of the trade off since more innovation will occur in a participatory economy than in capitalism for the same speed of adjustments. Secondly, a participatory economy is better suited to allocating resources efficiently to research and development because R&D is largely a public good which is predictably under supplied in market economies but would not be in a participatory economy. Third, the only effective mechanism for providing material incentives for innovating enterprises in capitalism is to slow their spread, at the expense of...

Globalization with Reason

2001-12-06 08:02:35 by fourtheweary

Governing Globalisation
An interview with George Monbiot, by Caspar Henderson of openDemocracy
George Monbiot, the leading environmental activist and writer, has been involved in many global campaigns of resistance to corporate and state power. But what positive social and political vision animates his work? Where does it contrast with that of globalisation’s advocates like Maria Cattaui, Peter Sutherland, and George Soros? And how does he see the future of the internationalist movement in the light of the ‘war on terrorism’? (v. long)
Caspar Henderson – openDemocracy has opened a debate on globalisation

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