Corporate Finance
April 2022 Examination
NMIMS Global Access
School for Continuing Education (NGA-SCE)
Course: Corporate Finance
Internal Assignment Applicable for April 2022 Examination
1. The capital structure of ABC Pvt. Ltd is as follows:
Equity share capital (each share of Rs. 10) = Rs. 10,00,000
Debentures with a coupon rate of 9.5% = Rs. 8,00,000
Reserves and surplus = Rs. 7,00,000
For Theoretical Answer
Assessment Parameter
Weightage
Introduction
20%
Concepts and Application related to the question
60%
Conclusion
20%
For Numerical Answer
Assessment Parameter
Weightage
Understanding and usage of the formula
20%
Procedure / Steps
60%
Correct Answer & Interpretation
20%
Revenue from the business activities for the company is Rs. 1.50 crores. Its variable cost is 8% of the revenue, fixed operating cost is Rs. 48 lakhs and the company pays income tax at a rate of 25%.
a. Calculate financial leverage, operating leverage and combined leverage for the company.
b. Determine the likely level of EBIT for EPS of (i) Rs. 20, (ii) Rs. 30, and (iii) Rs. 45 (10 Marks)
2. The equity shares of a publicly traded company are priced at Rs. 450 with P/E (Price to Earnings) ratio of 15. The announces a dividend of Rs. 9 per shares. The shareholders of the company expect the dividend to grow at a rate of 6% every year, and the cost of equity for the company is 15%. According to the dividend relevance approach suggested by Walter and Gordon, what would be the impact of dividend announcement on the market price of the shares of the company if required rate of return for investors is (i) 12%, (ii) 15% and (iii) 18%. (10 Marks)
3. A manufacturing company forecast that it is likely to sell 6,00,000 units for the year 2021. The processing cost of an order is Rs. 150 and the carrying cost per unit of inventory is Rs. 12. The lead time of an order is 8 days.
a. What would be the economic order quantity (EOQ) and re-order point assuming 300 days in a year. (5 Marks)
b. The company implements business process reengineering which results in to reduction of 20% in cost of an order, 10% in carrying cost per unit of inventory and 25% in lead time of an order. What would be the new EOQ and re-order point. (5 Marks)
*********
Complete Solved Assignment is available here
NMIMS Complete Solved Assignments
Available for the session April 2022
The deadline is March 25th, 2022
With our affordable and reliable service, we are here to help
Contact No – 8791514139 (WhatsApp)
OR
Mail us- [email protected]
Our website – www.assignmentsupport.in