Task: Net Present Value and Capital
MUTUALITY SCHOOL OF DISTANCE LEARNING
Post Box Number 503, Sector-44
Noida – 201303
Solution all questions.
a. If the titles of controller and treasurer become adopted underneath Indian circumstance? Would you like to change their capabilities in view of the company practice in India? Rationalize your judgment? b. A strong purchases a machinery pertaining to Rs. almost 8, 00, 500 by making a down payment of Rs. one particular, 50, 1000 and the rest in equal instalments of Rs. 1, 50, 500 for six years. Precisely what is the rate of interest to the company? 2 .
a. Explain the mechanism of calculating the current value of money flows.. Precisely what is annuity credited? How can you calculate the present and future principles of an pension due? Demonstrate b. ”The increase in the risk-premium of most stocks, irrespective of their beta is the same when risk aversion increases” Comment with practical examples
a. How power is associated with capital composition? Take example of a MNC and evaluate.
b. This figures relate to two firms (10)
P LTD. Q LTD.
(In Rs. Lakhs)
Variable costs200 300
Fixed costs150 400
150. three hundred
Interest 50 100
Profit prior to Tax100 2 hundred
You have to:
i) Compute the functioning, financial and combined utilizes for the 2 companies; and Comment on the relative risk position of those
a. Define numerous concepts of cost of capital. Explain the method of calculating weighted normal cost of capital.
m. The following items have been removed from the liabilities side of the balance sheet of XYZ Company as upon 31st 12 , 2005. Paid out up capital: Rs. some, 00, 1000 equity shares of Rs each 40, 00, 500 Loans:
16% non-convertible debentures 20, 00, 000 12% institutional loans 60, 00, 000
Additional information about the corporation as relevant is given listed below: 31st dec Dividend Making average market price Per share per share per talk about 2005 six. 2 15. 50 66
You are required to estimate the weighted average cost of capital, applying book principles as weight loads and earnings/price ratio because the basis of cost of value. Assume19. 2% tax rate 5.
a.. A company has granted debentures of Rs. 55 Lakhs being repaid following 7 years. Simply how much should the organization invest in a sinking fund making 12% in order to be able to pay off debentures? Show the procedure of loan demise and capital recovery through an example. w. A financial institution has wanted to you an annuity of Rs. 1, 800 intended for 10 years in the event you invest Rs. 12, 1000 today. What is the rate of return you should earn?
Answer all questions.
The proforma of cost-sheet of HLL provides the subsequent data:
|Cost (perunit): | | |Raw materials |52. 0 | |Direct labour |19. your five | |Overheads |39. zero |...