Department of Business Administration

Course Code : BKF 310 - Financial Management

Final LVS Exam, 20th September 2022

INSTRUCTION: ANWER ANY FOUR QUESTIONS ONLY

(All Questions Carry Equal Marks)
Time: 2.25Hrs (including upload of answer scripts)
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Question 1a): Kautal Hore has investment cost of N100,000 and expected net
cash flows as follows: N22,500, 000 for year 1 to 2; N30,000 for year 3 to 4; and
35,000 for year 5 to year 8. If the investor requires a 12 percent rate of return, what
is the discounted payback period of the project? (10 marks)
b) What will you advise Kautal Hore if the company is considering acceptable
period 4 years and 6 months as basis to undertake the investment? (5 marks)

Question 2: Many scholars advanced justifications for corporate mergers and

acquisitions. Discuss the salient points collectively agreed by these scholars (15
marks)

Question 3: Companies that are listed to operate in Nigerian capital market and
their stockholders are allowed some contingent privileges by the charter. Discuss
with examples in relation to these privileges (15 marks)

Question 4: Despite the hike in products and customer apathy due to the current
economic situation, the financial activities of Fatima Zara Group of Companies
for the year ending 31st December 2021 indicate the following information:
i. Annual sales - N1, 700,000
ii. Goods of goods sold – N1,000,000
iii. Annual Receivable – N380,000
iv. Inventory -N350,000
v. Payables – N350,000
vi. Debt for the year N200,000
vii. Interest payable N300,000

a). You are required to calculate the cash conversion cycle (CCC) of Fatima
Zara Group of Companies assuming the industrial average is given as 100 days
(10 marks)
b). Based on your CCC calculation, advise Fatima Zara on the three steps to
take (5 marks)

Question 5: Capital investment involves large expenditure and, in most cases,

when the investment is made it becomes difficult to reverse. Discuss this statement
and its significance (10 marks)
b). What is your view on the concept of synergy? (5 marks)
Question 6: One of the challenges of entrepreneurial development is the
limitation of capital. Discuss some of the internal ways that can assist
entrepreneurs in the quest to realising their main objective. (8 marks)
b) Every business outfit has its woes and comparison to its success measures.
Explain this statement in relation to any one form (7 marks)