Amity MBA 3rd Sem ASODL Equity Research and Portfolio Management

Assignment A

Question 1.(i) Sweat equity is the best form of reward for those who contribute to the growth of a company. Discuss.

(ii) Why do investor add real estate in their portfolio?

(iii) What are the steps taken by SEBI in the primary market to protect investors?

Question 2 (i) Discuss the dematerialisation and rematerialisation processes in NSDL?

(ii) ‘Stock market indices are the barometers of the stock market’ – Discuss?

(iii) How can increasing short interest give a bullish interpretation Why?

Question 3.(i) Explain the utility of the economic analysis and state the economic factors considered for this analysis.

(ii) What is meant by fundamental analysis? How does fundamental analysis differ from technical analysis?

(iii) What “industry life cycle exhibits the status of the industry and gives the clue to entry and exit for investors” Elucidate.

Question 4.Stocks L and M have yielded the following returns for the past two years.

(i) What is the expected return on portfolio made up of 60 percent of L and 40 percent of M? Find out the standard deviation of each stock.

(ii) What is the covariance and co-efficient of correlation between stock L and M?

(iii) What is the portfolio risk of a portfolio made up of 60 percent of land 40 percent

Question5. For the first four years XYZ firm is assumed to grow at a rate of 10 per cent. After four years the growth rate of dividend is assumed to decline linearly to 6 per cent. After 7 years, the firm is assumed to grow at a rate of 6 per cent infinitely. The next year dividend is Rs.2 and the required rate of return is 14 per cent. Find out the value of the Stock.

Question 6.Mr. Rajan Tiwari is planning to invest in the equity stocks of Xerox India Limited. The current share price is Rs.150 per share. Xerox has declared a dividend of Rs.10 per share for the current year. Mr. Tiwari is of the opinion that the dividend per share will remain at the same level for the next two years, after which it will grown at the rate of 25% per annum in the third and fourth years. From the fifth year onwards, dividends are expected to grow at a

normal rate of 12% per annum. If the required rate of return of Mr. Tiwari is 14% per annum, do you suggest him to purchase the share at the current price.

a. Intrinsic value of the stock is Rs.551.98 and it is recommended to purchase the share

b. Intrinsic value of the stock is Rs.551.98 and it is nor recommended to purchase the share.

c. Intrinsic value of the stock is Rs.517.83 and it is recommended to purchase the share.

d. Intrinsic value of the stock is Rs.517.83 and it is not recommended to purchase the share

e. Intrinsic value of the stock is Rs.150 and it is recommended to purchase the share.

Question 7. Vishnu ltd, has just paid a dividend of Rs.16 per share. As a part of its major reorganization of its operations, it has stated that it does not intend to pay any dividend for the next two years. In three years time it will commence paying dividend at Rs.12 per share and the directors have indicated that they expect to achieve dividend growth at 14% p.a.thereafter.

If the reorganization does not take place, dividend will be paid in the next two years and the expected dividend growth will remain at the present level of 8% p.a. The firm’s cost of equity is 18% (i.e. the return expected by the equity investors) and will be unaffected by the reorganization. What will be the value of firm’s shares in both the situations? Moreover, advice the directors to which process they should adopt for?

Question 8. Sundaram finance Ltd. has an investment opportunity available which will involve a capital outlay in each of the next 2 years and which will produce benefits during the following 3 years. A summary of the financial implications of this investment is given below.

Assignment B

Read the case study given below and answer questions given at the end.

Case study

Question 1. Compute the beta and interpret it for Prashant. Examine different circumstances with analysis of data.

Assignment C

1. Which of the following is /are true?

a. All investments are speculative by nature

b. Genuine investments involve calculated risks which are consistent with the expected returns

c. The ultimate objective of an investment or speculative stock is to increase the terminal wealth of the person concerned

d. Both b and c above

2. Which of the following is not an investment constraint?

a. Liquidity

b. The absence of the need for regular income

c. the preferred time horizon

d. Risk tolerance

3. A straight debenture is one which

a. Offers straight interest payments and is redeemed at par

b. Can be transferred by simple endorsement and delivery

c. Does not have a charge on any of the company’s assets

d. Is automatically converted into a share at maturity

4. The issuing company has to create a Debenture Redemption Reserve up to _________ of the amount of debentures to be redeemed, before the date of redemption

a. 10%

b. 25%

c. 30%

d. 50%

5. Which of the following is not a non-security form of investment?

a. National savings scheme

b. Purchase of gold and art objects

c. Bank deposits

d. Corporate fixed deposits

6. Corporate fixed deposits

a. Are secured by the fixed assets of the issuing company

b. Have no upper limit on the interest rate they offer

c. Have a minimum maturity of 3 years

d. Cannot exceed 10% of the share capital plus free reserves

7. The threshold limit for total FII investments in an Indian company is

a. 10%

b. 24%

c. 30%

d. none

8. Risk(s) affecting all the securities in the market is/are

a. Risk due to variability in returns due to changed investors’ expectations

b. Financial risk

c. Inflation risk

d. both a & c

9. The risk for the whole market as measured by ‘Beta’ is

a. 1

b. b. 0

c. c. -1

d. Greater than 1

10. Of the following, systematic risk encompasses

a. Business risk

b. Inflation risk

c. Interest rate risk

d. Both b and c

11. Securities which are plotted above the SML line are

a. Under priced

b. Over priced

c. Favourable investments

d. Both a and c

12. Covariance between a stock and a market index and the variance of the market

index were found to be 33.56 and 19.15 respectively. The Beta of the stock is

a. 1.55

b. 1.75

c. 1.85

d. 1.95

13. The beta of a stock is 1.12 and its covariance with the market is 220. The

standard deviation of market returns is

a. 16%

b. 14%

c. 12%

d. 11.30%

14. The characteristic line established the relationship between

a. Return on a security and its beta

b. return on a security and its standard deviation

c. Return on the security and return on the market

d. Risk of the security and risk of the market

15. Which of the following statements is true?

a. Slope of SML is known as beta

b. Slope of CML is known as beta

c. CML includes inefficient portfolios

d. CML is a relationship between total risk and required return.

16. Government securities are free from

a. Default risk

b. Purchasing power risk

c. Interest rate risk

d. Reinvestment risk

17. Riskiness’ of a security in the context of security analysis essentially means

a. Variability of the security’s returns

b. Variability of returns above a benchmark mentioned by clients

c. Variability of returns below a benchmark mentioned by clients

d. Market risk

18. Market Indicators are employed in

a. Studying the behavior of the stock market

b. Evaluating the performance of the portfolios

c. Calculating betas of the securities

d. All of the above

19. As the business cycle enters the initial phase of economic recovery the stock

prices generally

a. Decline

b. Maintain the same trend as before

c. Rise

d. Rise to an extent and then take a downturn

20. Cyclical industries are those

a. Which experience high growth rates when economy is booming

b. Which perform irrespective of the economic conditions

c. Which experience downtrend when economy is in recession

d. Both a and c

21. High growth rates in earnings and market shares is a characteristic of companies which are in

a. Maturity stage

b. Expansion stage

c. Pioneering stage

d. Declining stage

22. Which among the following is not volatile?

a. Cyclical growth industries

b. Growth industries

c. Cyclical industries

d. Defensive industries

23. In a balance sheet, equity and fixed assets are expressed in terms of their

a. Market value

b. Cost

c. Book value

d. Replacement value

24. The measurement of leverage is

a. PAT/Equity

b. Equity/Debt

c. Total assets/Equity

d. Total assets/Debt

25. Which of the following is/are cyclical industries?

a. Steel and Iron

b. Construction

c. Shipping

d. Cement

26. An industry in the expansion stage of its life cycle is indicated by

a. High P/E ratios

b. High dividend pay out ratios

c. High dividend yield

d. High investment in R & D

27. A business division with high growth but low relative market share is referred

to as a

a. Cash cow

b. Profit center

c. Question Mark

d. Star

28. during an inflationary period a company can artificially show higher profits by

a. Moving from FIFO and LIFO method of inventory valuation

b. Moving from LIFO to FIFO method of inventory valuation

c. Shifting from FIFO to the weighted method of inventory valuation

d. None of the above

29. An industry in the growth stage of its life cycle is indicated by

a. High P/E ratios

b. High dividend pay out ratios

c. High dividend yield

d. High investment in R & D

30. Which of the following is not an entry barrier?

a. Profit differentiation

b. Switching costs

c. Capital requirements

d. Low value addition

31. For a symmetrical triangle to be formed in a series of rallies

a. The succeeding peaks are lower than the preceding ones at the top

b. The succeeding crest at the bottom are lower than the preceding ones

c. The succeeding crest at the bottom are higher than the preceding ones

d. Both a and c

32. If a vertical rally or decline comes to a temporary halt to consolidate the

gain/loss after which the prices move in the same direction, give rise to

a. Flag

b. Rectangle

c. Gap

d. Both a and b

33. Which of the following is a measure of momentum against itself?

a. Relative strength indicator

b. Rate of change


d. Stochastic

34. In a technical analysis the exponent value for calculating a 10 day Exponential

Moving Average will be

a. 0.2

b. 0.1

c. 2

d. 20

35. In technical analysis the odd-lot theory is a classic example of

a. Oscillator

b. Breadth of market indicator approach

c. Contrarian opinion theory

d. Dow Theory

36. The argument that when stock prices increase, the closing prices have a tendency to be closest to the peaks of the period, forms the basis of

a. Exponential moving average

b. Confidence index

c. Elliott wave theory

d. Stochastic

37. Which of the following best measures the strength of market advances of


a. Moving average analysis

b. Stochastic

c. Gap analysis

d. Breadth of market indicators

38. Which of the following is an assumption of technical analysis?

a. market value is determined by the interaction of different judgmental value parameters

b. Supply and demand are governed by factors which are only rational

c. Stock prices tend to fluctuate widely over appreciable period of time and hence

cannot be predicated

d. Chart patterns tend to repeat themselves

39. An investor buys an option contract for a premium or Rs. 200. The exercise price is Rs. 20 and the current market price of the share is Rs. 17, if the share

price after three months reaches Rs. 25, what is the profit made by the option

holder on exercising the option. Contract is for 100 shares. Ignore the transaction charges

a. Rs. 200

b. Rs. 250

c. Rs. 300

d. Rs. 350

40. A put option was written at a premium of Rs. 400. The current market price of

the stock is Rs. 38 and the exercise price of the contract is Rs. 35. After a

period of two months the price of the stock is Rs. 30. The amount of the profit

made by the option holder is Rs. ___________

a. 325

b. 250

c. 150

d. 100



  1. India’s largest stock exchange is
  2. Stock exchanges have  roles in the economy
  3. There is usually…….compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange.
  4. Buyers and sellers come together to trade ………specific hours on business days.
  5. If a particular company is traded on an exchange, it is referred to as ……….
  6. When people draw their savings and invest in shares, it leads to a more …………. allocation of resources
  7.   Exchanges ……… rules and regulations on the firms and brokers that are involved with them.  
  8. investing in shares is open to ……… the large and small stock investors
  9. Companies that are not listed on a stock exchange are sold ……..
  10. An exchange is an institution, organization, or association which hosts a market where stocks, bonds, options and futures, and commodities are traded. 
  11. Listing requirements are the set of conditions imposed by a given ……… upon companies that want to be listed on that exchange
  12. Stock exchanges originated as ……. organizations, owned by its member stock brokers.
  13. Some exchanges are physical locations where transactions are carried out on a ……….. floor, by a method known as open outcry
  14. Actual trades are based on an auction market model where a potential buyer bids a specific price for a ………and a potential seller asks a specific price for the stock. 
  15. The stocks are listed and ,……….on stock exchanges 
  16.   When a company is delisted, it is a serious sign of financial or managerial trouble and generally causes the stock price to ……………
  17. The exchanges provide real-time trading information on the listed securities, facilitating price discovery.
  18. Companies that have shares traded OTC are usually …………… and riskier 
  19.   The ……… monitors the transactions to avoid illegal activity and / or stock price manipulation.
  20. The NASDAQ is a …… listed exchange, where all of the trading is done over a computer network
  21. The ……….. that an exchange provides affords investors the ability to quickly and easily sell securities. 
  22. the price of shares and other assets is an important part of the dynamics of ….activity
  23.   Stock exchange “specialists” play a ………. role in the process, helping to keep an orderly market by deftly matching buy and sell orders.
  24. Exchanges also act as the………… for each transaction
  25. stock exchanges are……… of a global market for securities.
  26. Stock valuation models are methods to value ……..
  27. ……….is probably the most common model that you ever heard when it comes to stock valuation
  28. The discounted rate normally includes a risk …….. which is commonly based on the capital asset pricing model.
  29. Some feel that if the stock is listed in a well organized stock market, with a……….. volume of transactions, the listed price will be close to the estimated fair value
  30. Fundamental analysis of a business involves analyzing its financial statements and health, its management and ….. advantages, and its competitors and markets.
  31. Fundamental analysis is performed on historical and present data, but with the goal of making …..forecasts. 
  32. the discounted cash flow (DCF) method, involves …….. of the profits
  33. Investors may use fundamental analysis within different … styles.
  34. Technical analysis is a security analysis discipline for forecasting the……..direction of prices through the study of past market data, primarily price and volume.
  35. Technical analysts may employ models and trading rules based on price and volume transformations, such as the relative strength index, ……. averages, regressions
  36. in addition to fundamental economic criteria, ………….. criteria also have to be taken into account market-based valuation.
  37. Technical analysis ….. that prices already reflect all such influences before investors are aware of them
  38. The term business cycle (or economic cycle) refers to economy-wide fluctuations in production or ………….activity over several months or years. 
  39. economic theory has moved towards the study of ………. fluctuation rather than a ‘business cycle
  40. managing economic policy to smooth out the cycle is a ……….. task in a society with a complex economy.

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Amity MBA 4th Sem ASODL Production Planning And Control

Amity MBA Assignment A
Question 1: a) Explain the forecasting process? What are the techniques for monitoring forecasts?
b) Explain various forecasting models.
Question 2: a) What is aggregate production plan? What are the pure strategies for APP?

b) The demand and capacities for production of company is given below. Demand for January, February and March are 900, 300 and 700 respectively. The production capacities for each of the month are given below.
January February March
Regular time 600 300 200
Over time 300 300 300
Sub contracted 500 500 500
The production cost per unit during regular time is Rs 60, during over time is Rs 70, and the sub contracted cost is Rs 72. The cost of carrying inventory is Rs 5 per unit per month. The cost of unused regular time capacity is Rs 15. Find the optimum production plan using transportation model.

Question 3: a) What is Master Production Scheduling? Explain various types of Bill of Materials.

b) What are the various disaggregation methods in use?
Question 4: a) Explain Materials Requirement Planning. What are the inputs and outputs of MRP?

b) Explain the various Lot sizing techniques.

Question 5: a) Explain assembly line balancing clearly defining various terminologies like cycle time, precedence diagram, work
stations, efficiency, utilization, balance delay, etc.

b) Explain the key elements to successful JIT.

Question 6: Explain, long-range, medium-range and short-term capacity planning methods?
Question 7: a) What are various batch processing techniques?

b) Explain the concept of theory of constraints and synchronous manufacturing.

Question 8: Write short notes
a) Kanban
b) Scheduling and sequencing
c) System nervousness

Amity MBA Assignment B
Case study: Please read the case study given below and answer questions given at the end.

a) A company is setting up an assembly line to produce 192 units per eight-hour shift. The following table identifies the work elements, items, and immediate predecessors.

Question 1: What is the desired cycle time? What is the theoretical minimum number of work stations?
Question 2: Use the largest work element time rule to work out a solution.
Question 3: What are the idle time, efficiency and balance delay for the solution?

Amity MBA 3rd Sem ASODL Cost & Management Accounting

Assignment A

Q1. Cost accounting is becoming more and more relevant in the emerging economic scenario in India’. Comment.
Q2. An efficient system of costing is essential factor for industrial control under modern conditions of business and as such may be regarded as an important part in the efforts of any management to secure business stability’. Elaborate.
Q3. From the following transactions extracted from the books of accounts of a manufacturing concern as on 31 April 2011. Work out a) consumption value of raw material in the month and b) value of closing stock as on 31 April 2011 under the FIFO method of pricing issues:
Q4. From the following information prepare a cost sheet showing cost profit per unit
Direct materials consumed Rs.4, 00,000
Direct labour 40% of direct material cost
Direct expenses 50% of direct labour cost
Factory overheads 25% of prime cost
Office and admin expenses are @ Rs.150 per 10 units produced
Selling & distribution overheads are Rs. 500 per 100 units sold
Opening finished stock 800 units @ Rs.85.50
Closing stock 400 units
Finished goods sold 16,400 units
Profit 1/6th of sales
Q5. Answer any three questions of the following:
a. Explain product cost and period cost with 2 examples of each.
b. What is meant by direct material cost?
c. Find out the cost of raw material purchased from the data given below:
d. Distinguish between costing and cost accounting.
e. Define batch costing. Give examples of industries which adopt batch costing.
Q6. Mosaic Co. Ltd has three production depts A, B & C and two service depts D & E. Info:
Rent Rs. 5000 Indirect wages Rs. 1500
Power Rs.1500 Depreciation of Machinery Rs.10000
General lighting Rs. 600 Sundry expenses Rs. 10000
Prepare a statement showing distribution of overheads to various departments.
Q7. The following information is provided to you:

Selling price per unit Rs. 40
Variable cost Rs. 24
Fixed costs Rs. 6
Profit Rs. 10
Present sales volume is 2000 units
(a) P/V ratio (b) BEP (c) Margin of safety (d) profit at a sales volume of 2500 units (e) sales required to earn a profit of Rs. 26,000
Q8. What are budget and budgetary control? Discuss the advantages and essential for success of budgetary control.

Assignment B
Read the case below and answer the questions given at the end

Case Study

Coffee Cart Supreme sells hot and iced coffee beverages and small snacks. The following is last month’s income statement.

Particulars Amount $ Amount $
Revenue 5000
Cost of Beverage & snacks 2000
Cost of napkins, straws etc500
Cost of rent cart500
Employee wages 1000 4000
Pre tax profit 1000
Taxes 250
After tax profit 750

Q1. What is the total cost function for Coffee Cart Supreme? What is the tax rate for Coffee Cart Supreme?
Q2. Calculate the amount of sales needed to reach a target after-tax profit of $1,500.
Q3. What was Coffee Cart Supreme’s degree of operating leverage and Coffee Cart Supreme’s margin of safety in revenue last month?

Assignment C
Q1. Which of the following statement measures the financial position of the entity on particular time?
B Balance Sheet
Q2. The Process of cost apportionment is carried out so that—
D Common costs are shared among cost centers
Q3. Direct materials cost is Rs. 80,000. Direct labor cost is Rs. 60,000. Factory overhead is Rs. 90,000. Beginning goods in process were Rs. 15,000. The cost of goods manufactured is Rs. 245,000. What is the cost assigned to the ending goods in process?
D There will be no ending Inventory Solution
Q4. When prices are rising over time, which of the following inventory costing methods will result in the lowest gross margin/profits?
Q5. The main difference between the profit center and investment center is—
Q6. Which of the following is a characteristic of process cost accounting system?
Q7. Which of the following manufacturers is most likely to use a job order cost accounting system?
Q8. Production volume of 1,200 units cost incurred Rs. 10,000 and production volume of 1,400 units cost incurred Rs.20, 000. The variable cost per unit would be?
Q9. Cost accounting concepts include all of the following EXCEPT—
Q10. The main purpose of cost accounting is to—
Q11. Period costs are –
Q12. An organization sold units 4000 and have closing finished goods 3500 units and opening finished goods units were 1000.The quantity of unit produced would be—
Q13. Examples of industries that would use process costing include all of the following EXCEPT
Q14. The components of the prime cost are—
Q15. Opportunity cost is the best example of—
Q16. Fixed cost per unit decreases when-
Q17. Prime cost + Factory overhead cost is—
Q18. Find the value of purchases if Raw material consumed Rs. 90,000; Opening and closing stock of raw material is Rs. 50,000 and 30,000 respectively.
Q19. Annual requirement is 7800 units; consumption per week is 150 units. Unit price Rs 5, order cost Rs 10 per order. Carrying cost Rs 1 per unit and lead time is 3 week, The Economic order quantity would be-
Q20. For which one of the following industry would you recommend a Job Order Costing system?
Q21. ______________ method assumes that the goods received most recently in the stores or produced recently are the first ones to be delivered to the requisitioning department.
Q22. Cost of production report is a PRODUCTION PROCESS REPORT
Q23. Opening work in process inventory can be calculated as under—
Q24. Jan 1; finished goods inventory of Manuel Company was Rs.3, 00,000. During the year Manuel’s cost of goods sold was Rs. 19, 00,000, sales were Rs. 2, 000,000 with a 20% gross profit. Calculate cost assigned to the December 31; finished goods inventory.
Q25. The cost expended in the past that cannot be retrieved on product or service–
Q26. When a manufacturing process requires mostly human labor and there are widely varying wage rates among workers, what is probably the most appropriate basis of applying factory costs to work in process?
Q27. A typical factory overhead cost is—
Q28. Complete the following table—
Q29. The Kennedy Corporation uses Raw Material Z in a manufacturing process.
Information as to balances on hand, purchases and requisitions of Raw Material Z is given below:
Jan. 1 Balance:200 lbs. @ $1.50
08 Received 500 lbs. @ $1.55
18 Issued 100 lbs.
25 Issued 260 lbs.
30 Received 150 lbs. @ $1.60
If a perpetual inventory record of Raw Material Z is maintained on a FIFO basis, it will show a month end inventory of:
Q30. The difference between total revenues and total variable costs is known as—
Q31. Percentage of Margin of Safety can be calculated in which one of the following ways?
Q32. Which of the following represents a CVP equation?
Q33. For which one of the following industry would you recommend a Process Costing system?
Q34. If 120 units produced, 100 units were sold @ Rs. 200 per unit. Variable cost related to production & selling is Rs. 150 per unit and fixed cost is Rs. 5,000. If the management wants to decrease sales price by 10%, what will be the effect of decreasing unit sales price on profitability of company? (Cost & volume profit analysis keep in your mind while solving it)
Q35. If 120 units produced, 100 units were sold @ Rs. 200 per unit. Variable cost related to production & selling is Rs. 150 per unit and fixed cost is Rs. 5,000. If the management wants to increase sales price by 10%, what will be increasing sales profit of company by increasing unit sales price? (Cost & volume profit analysis keep in mind while solving)
Q36. The following is the Corporation’s Income Statement for last month: Particular Rs. Sales 4,000,000 Less: variable expenses 2,800,000 Contribution margin 1,200,000 Liss: fixed expenses 720,000 Net income 480,000 The company has no beginning or ending inventories. A total of 80,000 units were produced and sold last month. ( 36-39) What is the company’s contribution margin ratio?
Q37. What is the company’s break-even in units?
Q38. How many units would the company have to sell to attain target profits of Rs. 600,000?
Q39. Whatis the company’s margin of safety in Rs?
Q40. Inventory control aims at—

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Amity MBA 3rd Sem ASODL Management of Financial Services

Assignment A
Q1 What is a IPO? What is the procedure for an IPO?
Q2 What are the various aspects of project appraisal? Describe the process and different types of project appraisals.
Q3 What is loan syndication? Who are the various participants? Describe briefly various aspects of accessing debt and capital markets?
Q4 What are the various types of leases? What is the difference in hire purchase and consumer credit?
Q5 What is Venture Capital? What are the various stages of financing offered and factors to be taken into account in order to attract Venture Capital?
Q6 What is a mutual fund? Describe various types of mutual funds. Also describe about organization, management and regulation of mutual funds.
Q7 Write short notes on the following.
a) Credit Rating Agencies
b) Resource Factoring
c) Merchant Banking
Q8 Write short notes on any three of the following:
a) Leasing Vs. Buying
b) Securitization
c) Role of ‘ Factor’ and that of ‘Forfaitor’
d) Prudential norms
e) Loan syndication
Assignment B
Case Study

ABC Industries – Lease Vs. Buy

ABC Company can purchase a $50,000 piece of equipment by putting 25 percent down payment and paying off the balance at 10 percent interest with four annual installments of $11,830. The equipment will be used in your business for eight years, after which it can be sold for scrap for $2,500. The alternative is that it can lease the same equipment for eight years at an annual rent of $8,500, the first payment of which is due on delivery. ABC will be responsible for the equipment’s maintenance costs during the lease.
ABC expects that its combined federal and state income tax rate will be 40 percent for the entire period at issue. Its cost of capital is 6 percent (the 10 percent financing rate adjusted by your tax rate).


Assignment C
1. Which of the following must be satisfied to support a classification as a finance lease?

Ownership is transferred by the end of the lease term.
The lease contains a bargain purchase option.
The lease term is for the major part of an asset’s useful life.
The present value of the minimum lease payments are substantially more or equal to the asset’s fair value.
2. Efforts Ltd negotiated a lease on the following terms: the term of the lease was 5 years; the estimated useful life of the leased equipment was 10 years; the purchase price was $ 60,000; and the annual lease payment was $ 5,000. This lease should be classified as-
A An Operating Lease
3. The lease analysis should compare the cost of leasing to the—
4. Operating leases usually have terms that include—
5. Which of the following statements about listing on a stock exchange is most correct?
6. Which of the following refers to mezzanine financing?
7. The Sarbanes-Oxley Act of 2002 (SOX) was largely a response to—
8. A company’s ………. is (are) potentially the most effective instrument of good corporate governance.
9. The focal point of financial management in a firm is—
10. The long-run objective of financial management is to—
11. ____________ of an investment bank.
12. ____________ are financial assets.
13. Firms that specialize in helping companies raise capital by selling securities are called—
14. The sale of a mortgage portfolio by setting up mortgage pass-through securities is an example of ________.
15. Corporate shareholders are best protected from incompetent management decisions by—
16. Financial assets ____________.
17. Investment bankers perform the following role(s ____________.
18. Theoretically, takeovers should result in ___________.
19. Important trends changing the contemporary investment environment are –
20. Higher operating leverage is related to the use of additional __________.
21. __________ lease is a long-term lease that is not cancelable and its life often matches the useful life of the asset.
22. __________ lease refers to a short-term lease that is often cancelable. For example, a lease for office space represents this type of lease where the lease life is less than the useful life of the asset.
23. Which of the following is not a type of financial lease arrangement?
24. Which of the following statements is most correct as it relates to the recording of a capital lease?
25. A __________ is generally considered debt that is originally scheduled to be repaid between 1 to 10 years under a formal loan agreement and is usually amortized (principal and interest are paid) in equal periodic installments.
26. A __________ is charged by the lender to hold credit open for the borrower. For example, if the firm only uses $100,000 of a $200,000 limit, then the firm might pay the lender $500 for the unused limit in addition to the interest on the amount borrowed.
27. __________ lease is a lease where the lessee maintains and insures the leased asset rather than the lessor in a full-service lease.
28. Your firm currently has a current ratio of 1.90 on $9.5 million of current assets. You are changing the financing mix of your firm and plan on converting financing of $1,000,000 in a 6-month loan into a 5-year term loan. The purpose of this move is to finance a more permanent portion of inventories with a longer maturity alternative. If the firm issues the term loan, new restrictive covenants will require that the current ratio remain at or above 2.00. Should the firm make this change or is there some obvious problem caused by this proposed change?
29. A __________ represents any restriction imposed on a borrower by a lender and would be part of the loan agreement.
30. A __________ is a continuously offered debt instrument that is designed to fill the gap between commercial paper and long-term bonds with maturities currently ranging from 9 months to 30 years and has gained favor from the existence of shelf registration.
31. A __________ forbids the future pledging or mortgaging of any of the borrower’s assets.
32. For a company subject to the alternative minimum tax (AMT), __________ is a “tax preference item,” whereas __________ is not. Such a company may prefer to __________.
33. A __________ allows the borrower to have credit up to some maximum amount over a specific period, but the notes are usually 90 days and allow the company to renew or borrow additionally.
34. Your firm currently has a current ratio of 2.10 on $5 million of current liabilities. You are financing a $500,000 machine (fixed asset) and $500,000 of additional inventories with a 5-year term loan. Alternatively, the firm can finance the additions with a 6-month loan that they will need to get approval to renew every six months. Existing restrictive covenants require that the current ratio remain at or above 2.00. Which alternative will keep the current ratio above 2.00?
35. With a capital lease, the amount recorded on the asset side of the balance sheet is __________.
36. Which of the following statements is most correct as it relates to the recording of a capital lease?
37. A __________ specifies all of the terms of a loan and the obligations of the borrower.
38. A special purpose vehicle (SPV) raises money by selling __________ where interest and principal payments are provided by cash flows from a discrete pool of assets.
39. _________ is a long-term, unsecured debt instrument with a lower claim on assets and income than other classes of debt; while a/(an) __________ bond issue is secured by the issuer’s property.
40. Which of the following statements concerning the rights of common shareholders is correct, or most accurate?

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Amity MBA 4th Sem ASODL Project Management and Control

Amity MBA Assignment A

1. Describe briefly the aspects of a business environment that needs to be monitored as well as the dimensions along which a firm may appraise its strengths and weaknesses for identifying investment opportunities.

2. The sales of a certain product during a 14 year period have been as follows:

Period Sales (Rs)
1 2,000
2 2,200
3 2,100
4 2,300
5 2,500
6 3,200
7 3,600
8 4,000
9 3,900
10 4,000
11 4,200
12 4,300
13 4,900
14 5,300
Find out the least square regression line for the data given.
For the data given above assume that forecast for the period 1 was Rs 2,100. If the constant (α) is equal to 0.3, derive the forecast for the periods 2 to 14.

Period Sales (Rs)
Let it be ‘X’ Let it be ‘Y’ X – x (mean) Y – y (mean) [(X-x)(Y-y)] (X – x) square
1 2,000 -6.5 -1464 9518 42.25
2 2,200 -5.5 -1264 6954 30.25
3 2,100 -4.5 -1364 6139 20.25
4 2,300 -3.5 -1164 4075 12.25
5 2,500 -2.5 -964 2411 6.25
6 3,200 -1.5 -264 396 2.25
7 3,600 -0.5 136 -68 0.25
8 4,000 0.5 536 268 0.25
9 3,900 1.5 436 654 2.25
10 4,000 2.5 536 1339 6.25
11 4,200 3.5 736 2575 12.25
12 4,300 4.5 836 3761 20.25
13 4,900 5.5 1436 7896 30.25
14 5,300 6.5 1836 11932 42.25

Total 105 48500 57850 227.5

Count / ‘n’ 14 14

Mean (total/’n’) 7.5 3464

Regression line is given as: y = mx + b

M is the slope which can be computed using = (Total of [(X-x)(Y-y)]) / Total of (X – x) square
= 57850 / 227.5
Therefore slope ‘m’ = 254.29

therefore point of intercept or regression line = y = mx + b
= 3464 = 254.29*7.5 + b
b = 3464-1907
Therefore b = 1557/-

Where ‘m’ is the slope, ‘m’ & ‘b’ provide a best fit line for the data
‘Y’ is a sales & ‘X’ is a period

3. What is Project Implementation Schedule? How it is important? What information is required for preparing the project implementation schedule?

4. What are replacement decisions? Explain three components of the cash flow stream of a replacement decision.

5. A company is considering an investment proposal to install new milling controls at a cost of Rs 50,000. The facility has a life expectancy of 5 years and no salvage value. The tax rate is 35 percent. Assume that the firm uses straight-line depreciation method and the same is followed for tax purposes. The estimated cash flows before depreciation and tax (CFBDT) from the investment proposal are as follows:

1 Rs 10,000
2 Rs 11,000
3 Rs 12,500
4 Rs 13,500
5 Rs 21,000

a. Compute the following
(i) Payback period
(ii) Accounting Rate of Return
(iii) IRR
(iv) NPV at 10 % discount rate.

6. (a) What are key issues considered by financial institutions while appraising a project for term financing?
(b) Discuss the key consideration in determining the debt-equity ratio of the firm.
7.What is Performance review and control in respect of the projects? What are advantages of conducting it? What problems are encountered in performance review and how can they overcome?
8.A project has the following time schedule:

Activity Time in weeks
1-2 4
1-3 1
2-4 1
3-4 1
3-5 6
4-9 5
5-6 4
5-7 8
6-8 1
7-8 2
8-9 1
8-10 8
9-10 7
Construct PERT network and compute
• TE (Tail Event) and TL (Head Event) for each event.
• Float for each activity.

Amity MBA Assignment B
Case Study
Dilemma of Project Manager
1. You are appointed to take up the task of metro project by Government of India. You are asked to complete the task within the period of seven years but you express your doubts on that stating various reasons and difficulties. The concerned secretary tells you to go through the project implementation history of Delhi metro project and prepare a complete report with regards to:

(a) Preparing the preliminary activities to be taken up before a large infrastructure project can be started.
(b) Understanding the significance of the role of a project manager in project execution.
(c) Understand the importance of the right work culture in successful project management.
(d) Recognize the importance of managing the various stakeholders in a project.
(e) Understand the difficulties involved in the execution of large infrastructure projects in developing countries, and how these can be overcome.
(f) Importance of financial management tools.

2. You have collected the requisite information through published and unpublished sources and compiled as given below

With a 6.5 km section of Line 3 becoming operational in April 2006, Phase I of the Delhi Metro3 project was nearing completion. Of the total length of 65.16 km of the first phase, 62 km had been completed and opened for service. This phase was set to cost Rs. 98 billion. As of early 2006, around 450,000 passengers were traveling by the Delhi Metro every day invariably and the strength will go up very fast. The Delhi Metro was meant to solve Delhi’s traffic problems, which had become almost unmanageable. The first steps to build a metro system in the city were taken in the early 1990s. In 1995, the Government of India (GOI) and the Government of the National Capital Territory of Delhi (GNCTD) formed the Delhi Metro Rail Corporation Ltd (DMRC) under the Companies Act to construct the Delhi Metro.
Conceived as a social sector project, a significant portion of the project cost was funded through a soft loan provided by the Japanese government through Japan Bank International Corporation (JBIC). The rest was contributed by GOI and GNCTD through equity. E. Sreedharan was appointed managing director (MD) of the DMRC and project manager for Phase I of the project in November 1997. Work on Line 1 of Phase I started in October 1998. DMRC formed consortiums to advise it on the project and to provide it with the latest technology. It also saw to it that the foreign companies worked with the Indian companies to ensure that the latter assimilated their expertise and technological know-how. The DMRC faced any number of technical and systemic challenges during the construction of the metro. However, thanks to thorough planning, an effective project design, and a ‘we-mean business’ culture, it was able to overcome all these hurdles. The organizational culture was based on punctuality, honesty, and a strict adherence to deadlines. The DMRC successfully managed the various stakeholders in the project like the general public, government bodies, etc., and also ensured that the project was environmentally safe. With Phase I of the Delhi Metro project nearing completion, the GoI decided to extend the metro network and work on Phase II of the Delhi Metro project was set to commence in September 2006.
In the process of implementing the project, the DMRC had gained a lot of technological expertise, which would be used by other cities in India and abroad to build metro systems similar to the Delhi Metro.
In order to implement the Delhi Metro project, the GoI and the GNCTD set up a 50:50 joint venture company called the Delhi Metro Rail Corporation Ltd. (DMRC). The company was incorporated under the Companies Act in May 1995. The DMRC was to complete Phase I of the project within 10 years, i.e., by the end of 2005.
With the funding for the project being finalized, the next step was to constitute a project team ESreedharan was appointed as project manager and managing director of the DMRC in November 1997. A technocrat, he had had a long stint in the Indian Railways (IR) and had retired in 1990. During his service with IR, he had earned a reputation for completing major projects on time and within the budget constraint. In India, major infrastructure projects are often stalled because of a lack of funds, political interference, lack of professionalism and accountability, property disputes, corruption, etc. Therefore, even before the commencement of the project, the DMRC attempted to put in place effective systems to ensure the smooth progress of the project. Funding was not an issue in the case of the Delhi Metro project because it was settled even before the project commenced.
In order to steer clear of political interference, the DMRC sought autonomy on all major matters and the GOI promised to give it this autonomy. Construction work on the project commenced from October 1, 1998. The entire project was divided into three lines. Further, these lines were divided into sections. Phase I commenced with the Shahdara-Tis Hazari section of Line 1, covering a distance of about eight kilometers. The work involved utility diversions, barricading, and actual civil construction. A major part of this section was on elevated tracks. All tracks in the elevated corridor were laid on concrete (ballast less). The tracks were supported on single piers.
Effective project management involved not only completing the project on schedule and within the budget, but also managing the project’s stakeholders. The stakeholders included the governments, the contractors, the funding agencies, and the general public. Despite assurances that the DMRC would enjoy autonomy, it faced political pressure not only in its recruitment processes, promotions, and contract awarding but also in land acquisition. The successful completion of the project effectively silenced the critics who had been skeptical about the ability of an Indian public sector organization to complete any project, let alone one as complex and costly as the Delhi Metro, on time and within the budget.

1. Prepare a detailed report with reference to the points secretary asked you in paragraph 1 above.
2. Similarities between the two projects and dissimilarities.
3. List out the activities required immediately. You can imagine data and figures wherever necessary.

Amity MBA Assignment C
1. Risks will be identified during which risk management process(es)?
2. Who is ultimately responsible for quality management on the project?
3. A project manager has just been assigned to a new project and has been given the
preliminary project scope statement and the project charter. The first thing the project
manager must do is:
4. You are taking over a project during the planning process group and discover that six individuals have signed the project charter. Which of the following should most concern you?
5. A project manager is employed by a construction company and is responsible for the furnishing of the completed building. One of the first things that the project manager for this project should do is to write a:
6. All of the following are characteristics of a project EXCEPT:
7. The equivalent of cost reimbursable contracts is frequently termed:
8. A buyer extends a formal invitation that contains a scope of work that seeks a response that will describe the methodology and results that will be provided to the buyer. This is called:
9. A project manager must have some work done by an outside contractor. This work has a great deal of risk associated with it, and it has become very difficult to find a contractor willing to take on the job. Which of the following types of contract would offer the greatest incentive to the contractor?
10. The project management process groups are:
11. In which project management process group is the detailed project budget created?
12. Contract closure is different from administrative closure in that contract closure:
13. During the full life cycle of the project, a plot of the project’s expected expenditures will usually follow a characteristic..S.. shape. This indicates that:
14. What conflict resolution technique is a project manager using when he says, “I cannot deal with this issue now!”
15. A group of related projects that are managed in a coordinated way that usually include an element of ongoing activity is called a:
16. To control the schedule, a project manager is reanalyzing the project to predict project duration. She does this by analyzing the sequence of activities with the least amount of scheduling flexibility. What technique is she using?
17. A project manager has just been assigned to a project. The document that recognizes the existence of the project is called:
18. A manager that manages a group of related projects is called a:
19. If project A has a net present value (NPV) of Rs 30,000 and project B has an NPV of Rs 50,000, what is the opportunity cost if project B is selected?

20. A project manager is using weighted average duration estimates to perform schedule network analysis. Which type of mathematical analysis is being used?

21. An activity has an early start (ES) of day 3, a late start (LS) of day 13, an early finish (EF) of day g, and a late finish (LF) of day ig. The activity:
22. Which phase of the project is likely to have the greatest amount of its funding spent?
23. Which of the following represents the estimated value of the work actually accomplished?
24. A project manager is managing a project. The original scope baseline of the project was budgeted at Rs 100,000. Since works on the project started there have been seventeen authorized and approved changes to the project. The changes have a value of Rs 17,000 and the cost of investigating them prior to their approval was Rs 2,500. What is the current budget (in Rs) for the project?
25. You are managing a project in a just in time environment. This will require more attention, because the amount of inventory in such an environment is generally:
26. A task was scheduled to use two persons, full time, and take two weeks to complete.
Instead, the project manager was only able to assign one person to this task. At the end of two weeks, the person assigned to the task was 75% complete. What is the cost
performance index?
27. Which of the following is considered to be a simulation technique?
28. Project A has an internal rate of return (IRR) of 21 percent. Project B has an IRR of 7
percent. Project C has an IRR of 31 percent. Project D has an IRR of ig percent. Which of these would be the BEST project?
29. The program evaluation and review technique (PERT) method of scheduling differs from the critical path method (CPM) because the PERT method:
30. In attempting to complete the project faster, the project manager looks at the cost
associated with crashing each activity. The best approach to crashing would also include looking at the:
31. The project is not completed until:
32. During project executing, a team member comes to the project manager because he is not sure of what work he needs to accomplish on the project. Which of the following documents contain detailed descriptions of work packages?
33. You are asked to prepare a budget for completing a project that was started last year and then shelved for six months. All the following would be included in the budget except?
34. During the project life cycle, in which part of the life cycle will risk be the lowest?
35. A project manager managing any project should perform risk analysis at what stage of the project:
36. You are the project manager for a high visibility project. The margin on this project is low, and it is extremely important that the cost estimates for the work on the project be accurate. While reviewing the cost estimates for this project you notice that one of the cost estimates for an element in the WBS is 10% higher than two previous projects for very similar work. What should you do?
37. The project life cycle differs from the product life cycle in that the project life cycle:
38. A manager and the head of engineering discuss a change to a major work package. After the meeting, the manager contacts you and tells you to complete the paperwork to make the change. This is an example of:
39. All of the following are parts of direct and manage project execution except?
40. A project manager does not have much time to spend planning before the mandatory start date arrives. He therefore wants to move through planning as effectively as possible. Which of the following would you recommend?

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