ADVANCED FINANCIAL MANAGEMENT

COURSE & SEMESTER

SEMESTER: - BBA V SEMESTER (FINANCE)
ASSIGNMENT – 01
1] Explain the
he difference between risk and uncertainty?
uncertainty

2] What do you mean by Risk? Explain different types of Risk.

ASSIGNMENT – 02
Problem 1

Problem 2
 ASSIGNMENT – 03
Problem 1
A Company issues 20,000, 10% preference share of Rs.100 each. The
cost of issues is Rs 2 per share. Calculate the cost of preference share
capital if these shares are issued (i) at par, (ii) at 10% premium (iii) at
Discount 5%.

Problem 2
ABC Ltd. issues 12% debentures of Rs.6, 00,000. The tax rate
applicable is 50%. Compute cost of debt capital (i) at Par, (ii) at 10%
Premium and (iii) at 10% discount.

Problem 3
The following information is available from the balance sheet of
Alexa Company:
Particulars Amount
Equity share capital 5,00,000
12%, Preference share 5,00,000
10%, Debenture 10,00,000
20,00,000

Company is paying Dividend of Rs.20 per share

Growth rate is 0%
Income Tax rate is 30%
Current price of Rs.100 per share is Rs.160
Calculate WACC?
 ASSIGNMENT – 04

Problem 1
The following information is available in respect of a firm:
Capitalization Rate = 10%

Earnings Per Share = Rs.50

Assumed rate of return on Investments:

(i) 12%

(ii) 8%

(iii) 10%

Show the effect of dividend policy on market price of shares applying

Walter’s formula when dividend payout ratio is [a] 0% [b] 20%
[c] 40% [d] 80% and [e] 100%

Problem 2
Agastya Ltd. expects annual net operating income of Rs.2,00,000. It
has Rs.5,00,000 outstanding debt, cost of debt is 10%. If the overall
capitalization rate is 12.5%. What would be the total value of the firm
and the equity capitalization rate according to the Net operating
Income Approach.
What will be the effect of the following on the total value of the firm
and equity capitalization rate if:
(i) The firm increases the amount of debt from Rs.5,00,000 to
Rs.7,50,000. What will be the effect on the value of the firm and Ke?
(ii) The firm redeems debt of Rs.2,50,000 by issuing fresh equity
shares of the same amount.
 ASSIGNMENT – 05

Problem 1

LAST
AST DATE TO SUBMITT ASSIGNMENT:-
ASSIGNMENT: 25-01-2020

Mail to chethan8@acharya.ac.in