SIBACA, LONAVALA 202- FM Class Test 1 1.

. Calculate the Operating leverage, financial leverage and combined leverage under situations A and B financial plan I and II respectively form the following relating to the operations and capital structure of ABC Ltd. Installed capacity Actual Production and Sales Selling Price per unit Variable cost Fixed cost Situations A Situations B Capital structure Financial plan Equity capital Rs.7000 Debt Cost of debt @ 10% I Rs.5000 Rs.5000 Rs2000 II Rs.800 Rs. 1500 Rs 15 1000 units 800 units Rs. 20

2. Calculate the pay back period for a project cash outlay of rs 300000and generate cash inflow Year 1 2 3 4 5 Cash in flow 70000 80000 100000 30000 20000