031115-601a-Quiz1

Date:03/11/2015 MBA601a-Quiz1 Duration 120 Min Name: Reg No. All questions carry equal marks, unless otherwise specified No clarifications entertained during the exam Open book, open laptop but closed wifi and Bluetooth exam

Prepare a Balance Sheet and P&L statement for the month of October (300 Points) Transactions for the month of October, 2015 Amt (Rs.) 1 Books Purchased 86000 2 Stationary Purchased (on credit) 31720 3 Other Items Purchased 15400 4 Employees Wages (accrued) 15080 5 Rent (Due) 2365 6 Books Sold (30% on credit) 125000 7 Electricity Bill 1297 8 LIC Premium (Due) 1206 9 Other Items Sold 20643 10 Misc. Expenditure 11200 11 Telephone Bill (Due) 1578 12 Stationary Sold 49435 13 Furniture Disposed (Book Value 5000) 920 Other than the above an amount of Rs.2000 has been paid as a bribe, another Rs. 1000 as donation for religious purposes and Rs. 10000 paid as dowry for daughters wedding. Loss due to pilferage by light fingered customers is estimated to be around Rs.30000 for the whole year. All items are sold at a 20% mark up on the cost Please make suitable assumptions and state your assumptions clearly

Balance Sheet Assets Liabilities

P&L Statement Particulars Amount


ABC Ltd. (Rs. Crores) 2015 2014 2013 2012 2011 Share Capital 10 26 23 7 7 Total Shareholders Funds 123 80 63 53 49 Secured Loans 7 15 16 13 1 Unsecured Loans 24 2 13 17 12 Total Liabilities 154 97 91 83 62 Accumulated Depreciation 19 12 8 5 2 Net Fixed Assets 37 9 8 11 9 Investments 31 33 33 33 33 Inventories 0 0 0 0 0 Cash and Bank 28 3 16 2 4 Loans and Advances 6 4 3 4 4 Total Current Assets 106 67 59 29 26 Total Current Liabilities 20 12 8 6 6

Use the above table for answering the following eight questions (240 Points) 1. In growth in Net Working Capital requirement was highest for the year

a) 2011 b) 2014 c) 2013 d) None of above

2. Assuming year to year changes in Reserves and surplus are driven by 60% of retained earnings, change in Reserves and surplus have been highest for the period a) 2013-14 b) 2012-13 c) 2011-12 d) Insufficient data

3. Assuming dividend payout to be 20%, PAT was lowest for the year a) 2015 b) 2012 c) 2014 d) None of above

4. From the above data which of the following is the firm’s main line of business? a) Manufacturing b) Trading c) Services d) Cannot say

5. Growth rate of Net Fixed Assets is lowest during a) 2012-13 b) 2011-12 c) 2013-14 d) None of above

6. Year to year asset growth is highest for the period of a) 2012-13 b) 2013-14 c) 2011-12 d) Cannot say

7. If capital structure defines risk, then for the period 2012-14 the firm’s risk profile has been a) increasing b) decreasing c) remained the same d) cannot say

8. For the period 2014-15 highest growth is recorded for a) Net Fixed Assets b) Sundry Debtors


c) Unsecured loans d) None of the above

9. You have invested 100 times of the last 4 digits1 of your Regn No. in a Monthly

Income Scheme (MIS)which pays a annual rate of interest of 8.0% p.a and the monthly income so generated is invested in a Recurring Deposit (RD) account which pays an annual rate of interest of 8.5% for a period of 36 Months and then 9.0% for the next 24 Months and 9.25% for the next 12 Months

The total Amount you will receive at the end of 6 years is ________ (200 Points) The Yield on your initial amount at the end of 6 years is equivalent to ________% (100 Points)

10. What is the value on December 31, 2015 of the following cash flows? (Use a 10% discount/compounding rate/ p.a).

Year Cash Received Amount/Month

2008 Last 4 digits of Reg No. X 100 2009 Last 4 digits of Reg No. X 100 2010 Last 4 digits of Reg No. X 100 2011 Last 4 digits of Reg No. X 100 2012 Last 4 digits of Reg No. X 100

Value on December 31, 2015 is __________(150 Points)

11. If your life pension contribution each year is equivalent to 10 times the last four digits of your Regn No. from this year till you are 70 Years of age and growing @ 10% per year. The pension fund also agrees to provide you with a 2.5 Crore of life cover till you are 70 years of age, whose premium normally is 5% of your annual contribution. What is the future value of your contribution assuming that you average yield on your investment is 9.25% when you are seventy? a) Total Amount at the end of the period is Rs.________ (100 Points) b) In which year will the Future Value of your contribution will be equal

to the cover of Rs. 2.5 Crore? No. of Years is _____ (200 Points) c) The actual yield on your contribution is______ (400 Points)

12. Theparvalueofabondis100tobepaidin5yearswithacouponrateof8%and a current annualized yield 6-Month yield of 11%, assuming coupon

1 In case the last four digits of your Regn. No. starts with a zero the take the last three digits and add a zero at the end and use the same to answer the question.


payments are made semiannually to bond holders and the next couponpayment is expected in 6 months. Please calculate the bond’s annualizeddurationandconvexity?Ifthesixmonthyieldisnow9%insteadof11%whatwouldthechangeinAnnualizeddurationandconvexityinpercentageterms?(400Points)a) AnnualizedDuration_______b) AnnualizedConvexity______c) ChangeinDuration______d) Change in Convexity_____

13. What is the price of the following bonds adjusted for both duration andconvexityifinterestratesgodownby100basisMarks,currentinterestratebeing7.55%.(200Points)S.No Bond Price1. SleepingBeautyBonds 2. NappingBeautyBonds 3. TenYearZeroCouponBond

14. Pleaseanswerthefollowingquestionsfromproblems4&5ofthebond

problemsetsenttoyouearlier?(150Points)a. WhatistheeffectiveannualyieldofPru-JohntowerandTomPaine

Mutual’sbonds(Question4)? Yield of Pru-John tower_______ Yield of Tom Paine Mutual_______

b. WhatisthepresentvalueofthefuturetaxsavingsofMcDonalds?PVofTaxSavingsis_______

031115-601a-Quiz1

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