B.C.A. (Semester III) (CGPA) Examination, 2017
FINANCIAL MANAGEMENT
Day Date: Friday, 21-04-2017 Max. Marks: 70
Time: 2:30 PM to 05:00 PM
N.B. Q.1 and Q.7 are compulsory.
Attempt any two questions from Q. 3 and 4.
Attempt any one question from Q. 5 and 6.
Q.1 Choose correct alternatives: 07
Business Finance deal with all of Business.
Planning activities Financial activities
Managerial activities Manufacturing activities
is a basic principle of any business activity.
Profit maximization Wealth maximization
Higher divided None of the above
The difference between current assets current liabilities is a
capital.
Debt Fixed Working None
refers to the assessment of financial requirement
then arranging the source of capital.
Financial planning Financial budgeting
Capital requirement Selling
Equity shares are paid dividend at rate.
Fluctuating Fixed High Lower
Operating leverage results form
Operating profit Variable costs
Fixed costs Operating expenses
What does ploughing back of profit mean?
Earning black money
Dividend not claimed by the share holder
Not paying a dividend in a certain year
Retaining the earning
Q.1 State whether True or False: 07
It is not possible to go ahead without financial planning.
Operating leverage x financial leverage combined leverage
Working capitals are required to meet the long term needs of
the business.
Debenture holder can participate in the management of the
company.
Page 1 of 2
Rate of dividend payable on preference shares is not fixed.
EBIT means Earnings before Interest Taxes.
Profit making is essential for the survival growth of the
business.
Q.2 Write short notes (Any 14
Importance types of working capital.
Importance of financial management.
Over capitalization and under capitalization.
Q.3 Write short notes (Any 14
Features of profit maximization.
Function of financial manager.
Merit demerits of wealth maximization.
Q.4 Write answer of the following questions (Any 14
Define working capital state the components of working capital.
Explain the steps in financial planning.
From the following information prepare a statement showing
working capital requirement.
Budgeted sales
Analysis of one rupee of sales
Raw material
Direct labor
Overheads
Total cost
Profit
Sales
Rs. 60, 000 p.a.
Rs
0.30
0.40
0.20

0.90
0.10

1. 00
It is assumed that:
Raw materials are carried in stock for 3 weeks finished
goods for 2 weeks.
Factory processing will take 3 weeks.
Creditors require 5 weeks.
Customer will require 8 weeks credit. It may be assumed that
Production overheads accrue evenly throughout the year. In
a year there are 52 weeks.
Q.5 What is working capital? State the determinants of requirement of
working capital.
07
What are the objectives of financial management? 07
Q.6 Define financial planning state the importance of financial
planning.
07
Critically evaluate the objectives of maximization of profit. 07
Q.7 Write short notes on (Any 14
Equity shares
Operating leverage financial leverage
Needs of working capital