FINANCIAL MANAGEMENT CA INTER

NATIONAL MANAGEMENT COLLEGE – PERUNDURAI

CA INTERMEDIATE

FINANCIAL MANAGEMENT

DATE : 08-10-2023 TOTAL MARK 65

10 MARK

1.Following information and ratios are ratios are given in respect of AQUA Ltd. for the year ended 31st March, 2023:

Current ratio4.0
Acid test ratio2.5
Inventory turnover ratio (based on sales)6
Average collection period (days)70
Earnings per share₹ 3.5
Current liabilities₹ 3,10,000
Total assets turnover ratio (based on sales)0.96
Cash ratio0.43
Proprietary ratio0.48
Total equity dividend₹1,75,000
Equity dividend coverage ratio1.60

Assume 360  days in a year.

You are required to complete Balance Sheet as on 31st March, 2023.

Balance Sheet as on 31st March, 2023

LiabilitiesAssets
Equity share capital (₹ 10 per share)XXXFixed assetsXXX
Reserves & surplusXXXInventory
Long-term debtXXXDebtorsXXX
Current liabilities3,10,000Loans & advancesXXX
Cash & bankXXX
TotalXXXTotalXXX

 

  1. The following figures are related to the trading activities of M.Ltd.

Total assets –    ₹ 10,00,000

Debt to total assets –    50%

Interest cost –    10% per year

Direct Cost –    10 times of the interest cost

Opening Exp. –     1,00,000

The goods are sold to customers at a margin of 50% on the direct cost Tax Rate is 30%

You are required to calculate                                                                                                                                                             (i) Net profit margin

(ii) Net operating profit margin

(iii) Return on assets                                                                                                                                                                      (iv) Return on owner’s equity

  1. Following information and ratios are given for W Limited for the year ended 31stMarch, 2022:
Equity Share Capital of ₹ 10 each₹ 10 lakhs
Reserves & Surplus to shareholders’ Fund0.50
Sales / Shareholders’ Fund1.50
Current Ratio2.50
Debtors Turnover Ratio6.00
Stock Velocity2 Months
Gross Profit Ratio20%
Net Working Capital Turnover Ratio2.50

 

You are required to Calculate :

(i) Shareholders’ Fund

(ii) Stock

(iii) Debtors                                                                                                                                                                                    (iv) Current liabilities

(v) Cash Balance

  1. Following are the data in respect of ABC Industries for the year ended 31stMarch, 2021 :

Debt to Total assets ratio : 0.40

Long-term debts to equity ratio : 30%

Gross profit margin on sales : 20%

Accounts receivables period : 36 days

Quick ratio : 0.9

Inventory holding period : 55 days

Cost of goods sold : ₹ 64,00,000

 

LiabilitiesAssets
Equity Share Capital20,00,000Fixed assets
Reserves & surplusInventories
Long-term debtsAccounts receivable
Accounts payableCash
Total50,00,000Total

Required:

Complete the Balance Sheet of ABC Industries as on 31st March, 2021. All Calculations should be in nearest Rupee. Assume 360 days in a year.

  1. Masco Limited has furnished the following ratios and information relating to the year ended 31stMarch 2021:
Sales₹ 75,00,000
Return on net worth25%
Rate of income tax50%
Share capital to reserves6 : 4
Current ratio2 : 5
Net profit to sales (After Income Tax)6.50%
Inventory turnover (based on cost of goods sold)12
Cost of goods sold₹ 22,50,000
Interest on debentures₹ 75,000
Receivables (includes debtors ₹ 1,25,000)₹ 2,00,000
Payables₹ 2,50,000
Bank Overdraft₹ 1,50,000

You are required to:

(a) Calculate the operating expenses for the year ended 31st March, 2021.

(b) Prepare a balance sheet as on 31st March in the following format:

LiabilitiesAssets
Share Capital

Reserves and Surplus

15% Debentures

Payables

Bank Term Loan

 

 

 

Fixed Assets

Current Assets

Stock

Receivables

Cash

 

 

 

  1. From the following information, complete the Balance Sheet given below:

(i) Equity Share Capital : ₹ 2,00,000

(ii) Total debt to owner’s equity : 0.75

(iii) Total Assets turnover : 2 times

(iv) Inventory turnover : 8 times

(v) Fixed Assets to owner’s equity : 0.60

(vi) Current debt to total debt : 0.40

Balance Sheet of XYZ Co, as on March 31, 2020

LiabilitiesAmount

(₹)

AssetsAmount

(₹)

Equity  Shares Capital

Long term Debt

Current Debt

 

2,00,000

?

?

 

Fixed Assets

Current Assets :

Inventory

Cash

?

 

?

?

 

  1. Following information relates to RM Co. Ltd                                                                                                                      ₹                                                                            Total Assets employed                                                                   10,00,000                                                                    Direct Cost                                                                                       5,50,000                                                                        Other  Operating Cost                                                                   90,000                                                                          Goods are sold to the customers at 150% of direct costs.                                                                                            50% of the assets being financed by borrowed capital at an interest                                                                        Cost of 8% per annum.

You are required to Calculate :                                                                                                                                                       (i) Net profit margin

(ii) Return on Assets

(iii) Assets turnover

(iv) Return on owners’ equity

  1. Following information has been gathered from the books of Term Ltd. the equity share of which is trading in the stock market at ₹ 14.
ParticularsAmount (₹)
Equity Share Capital (face value ₹ 10 )

10% preference Shares

Reserves

10% Debentures

Profit before Interest and Tax for the year

Interest

Profit after Tax for the year

10,00,000

2,00,000

8,00,000

6,00,000

4,00,000

60,000

2,40,000

 

 

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