B.B.A. (Semester VI) Examination, 2017
FINANCIAN MANAGEMENT-II
Day Date: Tuesday, 18-04-2017 Max. Marks: 80
Time: 10.30 AM to 01.30 PM
N.B. All questions are compulsory.
Figures to the right indicate full marks.
Use of Calculator is allowed.
Q.1 Choose the correct alternatives: 08
If current Ratio is 2 working capital is 100000 then the value of
current liability is
100000 50000 200000 300000
Outstanding Expenses is
Fixed Asset Current Assets
Current Liability Fixed Liability
Acid test ratio is also called as
Liquid Current
Working Capital Debt Equity
is a payment of additional shares to shareholders in lieu of
cash.
Stock Split Bonus Share
Extra Dividend Regular Dividend
ratios relate profits to sales and investments.
Liquidity Leverage
Activity Profitability
is non discounted technique of Capital Budgeting.
Pay Back Period PI
NPV None of these
BSE Sensex Consist Companies.
50 30 60 100
Market is for short term securities.
Capital Secondary
Money Primary
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SLR-SINA 49
Q.1 Fill in the Blanks: 08
NSE Stands for
NPV Stands for
FPO Stands for
SEBI Stands for
Reserves surplus to capital 0.5. If Capital=Rs.100000, then

EPS Stands for
In P/E ratio P/E Stands for
PI Stands for
Q.2 A Co. decides to float 12% debentures of Rs.100/- each. The tax
rate is 50%. Calculate Pre and Post tax Cost of debenture.
04
An equity share of the company is currently selling for Rs.100/- . The
company expects to pay Rs.12 per share as dividend at the end of
current year. Dividend per share is expected to grow at the rate of
p.a. Calculate the cost of equity.
04
Calculate explicit cost of debt for each of the following situation: 08
Debentures are sold par floatation cost is 5%.
Debentures are sold 10% premium floatation cost is of
issue price.
Assume:
Coupon rate of interest on debenture is 10%
Face value of debt Rs.100/-
Maturity Period=10 years
Tax Rate=35%
Q.3 Write short notes. 16
BSE
Functions of stock Exchange
Q.4 A Co. is considering an investment proposal to install new machine at a cost
of Rs.50,000/-. The machine has a life expectancy of 5 years and has no
salvage value. The tax rate is 35%. Assume that the firm use straight line
depreciation. The estimated cash flows before depreciation and tax (CFBT)
from the investment is as follows.
16
Year 1 2 3 4 5
CFBT 10,000 10,692 12,769 13,462 20,385
Discounting Factor Value
10% Discount rate
0.909 0.826 0.751 0.683 0.621
Calculate:
Pay Back Period
Average Rate of return
NPV 10% Discount Rate
PI 10%
OR
What is Ratio Analysis? State the various advantages and disadvantages of
ratio analysis?
16
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SLR-SINA 49
Q.5 From the following prepare balance sheet of Suraj Enterprises as on
31/03/2014.
16
Fixed Assets Rs.6 Lakhs
Working Capital Rs.4 Lakhs
Current Ratio 2
Fixed Assets to Turnover 4
Gross Profit 25%
Debtor's Velocity 1.5 Months or 8 times
Creditor's Velocity 2 Months or 6 times
Stock 2 months
Net profit Turnover
Reserve 2/3 of Net Profit
Capital Gearing 1:1
OR
What is capital Structure? Explain the various internal, external and general
factors affecting Capital Structure.