SlideShare a Scribd company logo
Q1) a) What do you undeastand by the concept of corporate Investment and
Financial Decisions.
OR
b) What are the various goals of the corporation for good governance of
the firn.
Q2) a) Following is the condensed income statement of a fim for the current
year.
Particulars Rs.
Sales 5,00,000
Less : Operating costs` 3,00,000
Less: Interest costs 12,000
Earning Before Taxes 1,88,000
Less : Taxes (40%) 75,200
Earning after taxes 1,12,800
The firms existing capital structure consists of Rs. 1,50,000/- equity
funds having 15% cost and of Rs.1,00,000/- 12% debt. Determine the
economic value added during the year.
OR
b) Two firms XYZ Ltd. and ABC Ltd. are identical in all respect, except
leverage in capital structure XYZ Ltd. has 10% Rs. 3,00,000/- debentures.
Both the firms have the same Earning before Interest and tax of Rs.
50,000/- The equity Capitalization rate of XYZ Ltd. is 16% and ABC
Ltd 12.5% . You are required to calculate the total Value of each firm.
Total No. of Questions : 5]
[Total No. of Pages : 2
[4970] - 4005
M.B.A.
404 FIN: CORPORATE FINANCE
(2013 Pattern)
Time :2½ Hours] [Max. Marks :50
Instructions to the candidates:
1) All questions carry equal marks.
2) All questions are compulsory.
P1753
SEAT No. :
P.T.O.
2[4970] - 4005
Q3) a) Explain the concept and features of value based management.
OR
b) What are the various criterias that has to be completed in order to achieve
Good Corporate Governance in India.
Q4) a) From the following information of a firm calculate share price based on
Walter's model and also say whether you are satisfied with the current
dividend policy or not?
i) Earnings per share - Rs.4/-
ii) Dividend per share - Rs.3/-
iii) IRR - 10%
iv) Return required by shareholder - 15 %
OR
b) The following data relate to a firm.
i) Earnings per share - Rs.10/-
ii) Capitalisation rate - Rs14%
iii) Retention rate - 40%
Determine share price using Gordon's model if IRR is 15%, 14% and
10%.
Q5) a) Define 'Corporate Restructuring'. What are the various reasons for
restructuring and the board areas of restructuring?
OR
b) Elaborate the following related to Corporate Restructuring.
i) Expansion technique
ii) Disinvestment technique.
M M MM M MM M MM M MM M M

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Corporate Finance Question paper

  • 1. Q1) a) What do you undeastand by the concept of corporate Investment and Financial Decisions. OR b) What are the various goals of the corporation for good governance of the firn. Q2) a) Following is the condensed income statement of a fim for the current year. Particulars Rs. Sales 5,00,000 Less : Operating costs` 3,00,000 Less: Interest costs 12,000 Earning Before Taxes 1,88,000 Less : Taxes (40%) 75,200 Earning after taxes 1,12,800 The firms existing capital structure consists of Rs. 1,50,000/- equity funds having 15% cost and of Rs.1,00,000/- 12% debt. Determine the economic value added during the year. OR b) Two firms XYZ Ltd. and ABC Ltd. are identical in all respect, except leverage in capital structure XYZ Ltd. has 10% Rs. 3,00,000/- debentures. Both the firms have the same Earning before Interest and tax of Rs. 50,000/- The equity Capitalization rate of XYZ Ltd. is 16% and ABC Ltd 12.5% . You are required to calculate the total Value of each firm. Total No. of Questions : 5] [Total No. of Pages : 2 [4970] - 4005 M.B.A. 404 FIN: CORPORATE FINANCE (2013 Pattern) Time :2½ Hours] [Max. Marks :50 Instructions to the candidates: 1) All questions carry equal marks. 2) All questions are compulsory. P1753 SEAT No. : P.T.O.
  • 2. 2[4970] - 4005 Q3) a) Explain the concept and features of value based management. OR b) What are the various criterias that has to be completed in order to achieve Good Corporate Governance in India. Q4) a) From the following information of a firm calculate share price based on Walter's model and also say whether you are satisfied with the current dividend policy or not? i) Earnings per share - Rs.4/- ii) Dividend per share - Rs.3/- iii) IRR - 10% iv) Return required by shareholder - 15 % OR b) The following data relate to a firm. i) Earnings per share - Rs.10/- ii) Capitalisation rate - Rs14% iii) Retention rate - 40% Determine share price using Gordon's model if IRR is 15%, 14% and 10%. Q5) a) Define 'Corporate Restructuring'. What are the various reasons for restructuring and the board areas of restructuring? OR b) Elaborate the following related to Corporate Restructuring. i) Expansion technique ii) Disinvestment technique. M M MM M MM M MM M MM M M