Concepts
- Distinguished between permanent and temporary working capital?
- What is business risk?
- Explain Inter-corporate Deposits?
- What are liquidity ratios and what is their significance?
- Why is cost of debt normally less than the cost of equity? Is it always so?
- What is meant by letter of credit?
- State in brief any three functions of Finance Manager.
- What is the difference between hypothecation and pledge?
- What is the meaning and significance of Weighted Average Cost of Capital?
- What is cash operating cycle?
- What is conservative Approach concept?
- What is Margin of safety
- Cost of Debt
- Trading on Equity
- Profit Maximization.
- Float
- Non-diversable Risk
- Financial Leverage
- What are motives of holding cash?
- Explain the concept of conservatism
- What is Miller and Modigliani Approach?
- What is meant by profitability index of a project?
- What do you understand by precautionary cash holdings?
- Financial Breakeven point
- What is meant by purchase consideration in case of business restructuring?
- What is meant by De-Merger in business restructuring?
- What is meant by ploughing back of profits?
Long Questions (10 Marks each)
- Explain the methods of measuring Cost of Debt Capital and Cost of Equity Capital with illustrations.
- Explain the steps involved in Credit Analysis in detail.
- What are the motives for holding cash?
- What is the meaning of the following terms? Commercial papers. and Bill discounting.
- What are the factors that determine working capital requirements?
- Explain the concept of working capital. How is working capital affected by (a) sales, (b) technology and manufacturing policy, and (c) price level changes?
- Ratio analysis is only a technique for making judgments and not a substitute for it. Comment.
- Discuss various cash management models.
- Discuss in brief the factors influencing Working Capital Requirements.
- Explain in brief the sources of Long Term Finance and Short Term Finance.
- Explain the importance of Leverage. Distinguish between Operating Leverage & Financial Leverage
- What is Lease Finance? Distinguish between Finance Lease and Operating Lease.
- Discuss the scope and significance of Finance Function.
- “Financial management is more than procurement of funds”. What do you think are the responsibilities of a finance manager?
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