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1. What does financial management mean? Explain the major finance functions (May 2004) 2. State in brief any three functions of finance manager. (Nov 2003) 3. Corporate houses today are increasingly moving towards wealth maximization from profit maximization. Comment on this movement. (May 2004) 4. The objective of financial management is wealth maximization and not profit maximization. Comment. (May 2004) 5. Discuss wealth maximization and shareholder value maximization as objectives of financial management. 6. Describe agency problem in achievement of objectives of financial management.
Ratio Analysis
1. Financial ratios may be classified according to their utility. How? 2. Discuss the significance of liquidity ratios. Explain with examples the interpretation of these ratios. 3. Discuss important profit margin ratios. 4. Illustrate importance and significance of turnover ratios. 5. What are liquidity ratios and what is their significance? (November 2002) 6. What are the limitations of ratio analysis? 7. What do leverage ratios indicate? (November 2001) 8. Explain the significance of capital gearing ratio. (May 2002)
Interpretation of Ratios
1. Ratio Analysis is only a tool and not a final decision Discuss. (May 2002) 2. Ratio analysis is only a technique for making judgments and not a substitute for it. Comment. (Nov 2003) 3. What are the precautions to be taken in trend analysis? (May 2003) 4. What are common-size statements? (Nov 2002)
2. What are funds flow statement and cash flow statement? How are they different from each other? (May 2004) 3. What are the uses of Cash Flow Statements? 4. Differentiate between cash flow and funds flow. 5. Cash flow is a special version of funds flow. Discuss.
Capital Structure
1. What are the characteristics of loan funds and equity funds? 2. Explain the methods of measuring cost of debt capital and cost of equity capital with illustrations (Nov 2001) 3. Why is cost of debt normally less than the cost of equity? Is it always so? (Nov 2002) 4. What is the meaning and significance of Weighted Average Cost of Capital? (Nov 2003) 5. Discuss Net Income Approach and Net Operating income Approach to capital structure. 6. What are the main propositions of traditional approach? 7. Explain Miller and Modigliani Position. 8. What is weighted average cost of capital?
Working Capital
1. What do you understand by gross working capital and net working capital? (May 2002) 2. Distinguish between permanent and temporary working capital. (Nov 2001) 3. What is operating cycle? How are its components calculated? 4. Compare usage of long-term and short-term funds for working capital. 5. What are the factors that determine working capital requirements? (Nov 2002) 6. Explain the concept of working capital. How is working capital affected by (a) Sales (technology and manufacturing policy and (b) price level changes? (Nov 2003) 7. Risk-return trade-off in working capital management. Discuss. 8. What is cash operating cycle? (May 2002, Nov 2003)
Cash Management
1. 2. 3. 4. 5. 6. What is cash budgeting? What is time horizon for it? Distinguish between a cash budget and a cash flow statement? (May 2003) How cash inflows can be improved or managed? Discuss importance of Internet in cash management. What are disadvantages of default in payment? How and in which avenues surplus cash may be invested?
Receivables Management
1. 2. 3. 4. 5. What is the purpose of maintaining receivables? What are the various costs associated with A/C receivables? (May 2003) Credit policy relate to which dimensions and decisions? Explain the steps involved in credit analysis in detail. (Nov 2001) What are the mechanisms to monitor receivables? Write a short note on each of them. 6. What is delinquency cost and del credre commission? (May 2004)