Fundamentals of Financial Management Question Paper 2023 [Gauhati University BCOM 5th SEM CBCS Pattern]

Fundamentals of Financial Management Question Paper 2023 
[Gauhati University BCOM 5th SEM CBCS Pattern]

COMMERCE (Honours Core)

Paper: COM-HC-5026 (Fundamental of Financial Management)

Full Marks: 70

Time: 3 hours

The figures in the margin indicate full marks for the questions.

1. Choose the right answers:                    1x10=10

(1) Which of the following is a part of financial decision making?

(a) Financing decisions.

(b) Dividend decision.

(c) Investment decision.

(d) All of the above.

(2) Which of the following represents the capital structure of a company?

(a) Debt and equities.

(b) Equities and preference share capital.

(c) All assets.

(d) All liabilities.

(3) Which of the following is also known as long-term investment decision?

(a) Dividend decision.

(b) Working capital.

(c) Capital budgeting decision.

(d) All of the above.

(4) Current assets are twice the current liabilities If the working capital is Rs. 2,00,000, current assets would be:

(a) Rs. 2,00,000.

(b) Rs. 4,00,000.

(c) Rs. 3,00,000.

(d) Rs. 1,00,000.

(5) The capitalisation of profit is termed as:

(a) Stock dividend.

(b) Cash dividend.

(c) Property dividend.

(d) Bond dividend.

(6) Investment decisions are outside the purview of financial decisions.

(a) True.

(b) False.

(7) Increased use of debt increases the financial risk of equity shareholders.

(a) True.

(b) False.

(8) Capital budgeting decisions are generally of irreversible nature.

(a) True.

(b) False.

(9) The rate of return on investment falls with the shortage of working capital.

(a) True.

(b) False.

(10) Profitability index is also known as benefit/cost ratio.

(a) True.

(b) False.

2. Answer the following questions in about 50 words each:                2x5=10

(a) What is financial management?

(b) What is leverage?

(c) What are the various methods of capital budgeting decisions?

(d) What is dividend?

(e) What is permanent working capital?

3. Answer the following questions within 150-200 words each: (any four)      5x4=20

(a) State the nature of financial management.

(b) Explain the significance of cost of capital.

(c) Explain the significance and limitations of financial leverage.

(d) Explain the capital budgeting process.

(e) Distinguish between gross working capital and net working capital.

(f) Explain the various forms of dividend.

4. Answer the following questions within 500-600 words each:

(a) Discuss the scope and objectives of financial management.                  10

Or

Describe the determinants of capital structure of a firm.

(b) State the various factors determining the dividend policy of a company.            10

Or

State the various factors determining the working capital requirements of a firm.

(c) Discuss the traditional methods of capital budgeting decision.                           10

Or

ABC Company is considering to purchase one of the following two machines, the details of which are given below:

Year	Cash inflow (Rs.)		Discount factor @ 10%
	Machine X	Machine Y
1st 2nd 3rd 4th 5th	3,00,000 4,00,000 5,00,000 3,00,000 2,00,000	1,00,000 3,00,000 4,00,000 6,00,000 4,00,000	0.909 0.826 0.751 0.683 0.621

Cost of Machine X and Machine Y is Rs. 10,00,000 each.

Calculate Net Present Value and Profitability Index.                    7+3=10

Also Read: Fundamentals of Financial Management Question Paper

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