Universities

Taxation- Direct and Indirect  Q1. How does the implementation of Goods and Services Tax (GST) resonate with the concept of ‘one nation, one tax’, and what are its implications for businesses and consumers in simplifying the indirect tax system of the country? (10 Marks) Q2. The following are the particulars of income of Ms. Sushmita for the previous year ended 31st March 2023. She is employed in a private institution. 1. Basic Salary Rs.9000 p.m. 2. Bonus equal to 2 months’ salary 3. Tiffin allowance Rs. 150 p.m. 4. Entertainment allowances Rs. 120 pm 5. Employee’s contribution to RPF @ 15% of salary. 6. Employer’s contribution to RPF @ 15% of the salary. 7. Interest credited to the provident fund @ 9.5% p.a is Rs. 5600 8. She is provided with free lunch in office. The cost per meal is Rs. 30. 9. The employer has given her a small car which she uses for personal as well as official purpose. She meets the expenses of the car which is used for personal purposes. Compute her income from salary for the assessment year 2023-24. (10 Marks) Q3. a) How does the Income Tax Act of 1961 elaborate on the criteria and conditions that determine the residential status of an individual for the purposes of taxation within India? (5 Marks) b) Considering the case of Mr. Potter, a foreign national, who arrived in India for the first time on June 15, 2017. Over the financial years 2017-18, 2018-19, 2019-20, 2020-21, 2021-22 and 2022-23 he spent 120 days, 115 days, 15 days, 191 days, 124 days, and 80 days in India, respectively. Determine Mr. Potter’s residential status for the Assessment Year 2023-2024. (5 Marks)

Strategic Cost Management 1) ABC Ltd. produces 3 products A, B & C. The following data is available for the year ended 31st March 2023. Product A  Product B  Product C Production Qty (Units)  4,000  3,000  1,600 Total Machine hours for production  60  30  20 Resources Per Unit – Direct Material (Kgs)  4  6  3 Direct Labour (Mins)  30  45  60 Cost of Labour is Rs. 10 per hour and material cost Rs. 2/kg. Production Overheads (Fixed) were Rs. 99,450. ABC Ltd. used Traditional Costing method and absorbed the Overheads to products based on Labour hour rate. It is now considering to adopt Activity Based Costing method. The following information was digged out and analysed by the Cost Accountant. Overheads were comprised of the following: Material Handling Rs. 29,100, Storage Costs Rs. 31,200 and Power Cost Rs. 39,150. Further the area occupied for storage of materials was in the ratio of 2:1:3. Prepare Cost sheet showing Unit cost and Total cost of each product using both Traditional Costing and ABC methodology. (10 marks) 2) Sitaram Ltd. is an ice cream manufacturer company. Its current revenue is Rs. 650,000 a month and a 40% contribution margin. Its fixed costs are Rs. 200,000. Ghanshyam Ltd. is another player in the ice cream business with a current sales of Rs. 420,000 and a 30% contribution margin. Its fixed costs are Rs. 90,000. a) What is the margin of safety for Sitaram and Ghanshyam Ltd? Compare the margin of safety in value between the two companies. Which is stronger? b) Compare the margin of safety in percentage between the two companies. Now which one is stronger? c) Prepare a budget for both companies showing their estimated profit at the current levels and at 75% of the current capacity. State your observations with respect to the Profit/Loss levels in both situations and their relation to Margin of Safety percentage. (10 marks) 3) a) Precision Limited is motor manufacturer. The company currently produces three different models of motors. It also produces all the blades of the motors as it requires. The requirement is of 3 different blades for each motor model (i.e. 9 different blades). Precision Limited received a proposal from a supplier who wants to sell the company blades for the motors line. The supplier would charge Rs. 25 per blade, regardless of blade type. For the next year the Company has projected the costs of its own blade production as follows (based on projected volume of 10,000 units): Direct materials                         Rs. 75,000 Direct labour                              Rs. 65,000 Variable overhead                      Rs. 55,000 Fixed overhead Factory supervision                   Rs. 35,000  Other fixed cost                          Rs. 65,000  Total production costs               Rs. 2,95,000  Assume: (1) The equipment utilized to produce the blades has no alternative use and no market value, (2) The space occupied by blade production will remain idle if the company purchases rather than makes the blades, and (3) Factory supervision costs reflects the salary of a production supervisor who would be dismissed from the firm if blade production is ceased. Determine the net profit or loss if the blades are purchased rather than manufactured. (5 marks) b) Priya Motors is planning to coming up with a new electric car. The promotor of the company has been conducting research in this field on and off for the past 2 years. The approximate amount spent on the R&D till date is Rs. 2 lacs. The cost of production of the vehicle is estimated to be Rs. 3 lacs. Marketing and promotional expenses are to the tune of Rs. 50,000. Based on prior experience, car has a after sales service expenses of Rs. 25,000 on an average during its life time. Being an electric car the cost is estimated lower at Rs. 20,000. If the company wants to earn a profit margin of Rs. 40,000 per car, at what price should Priya Motors price it? (Time value of money is ignored) What is the approach used for costing the car? Considering the stage of the product, what should be the considerations for spending on the following costs: a) Advertisement b) Maintenance cost. (5 marks)

Marketing of Financial Services  Q1. If a Bank want to categorize various Insurance Services for its various of Clients including HNI to Middle Income Groups as well as from Youth to Senior Citizen. In what direction respective Banks can demarcate Insurance Plans into various Types? Explain different Types of Insurance Plans fragmentation by Commercial Banks towards its Clients. (10 Marks) Q2. If a Scheduled Commercial Bank is opening its New Branch at Tier II City. Its conducting a Market Research with instrumental of respective 8 important P’s Factors of Marketing of Bank – Financial services. Kindly elaborate those any important 6 P’s from Marketing Head pt. of view. (10 Marks) Q3 a) If a Senior Professional Aged 55 is planning for his retirement, what important 3-4 factors to be pondered upon from his Age 55 to 60 last 5 Years? Elaborate Paradigm. (5 Marks) Q3 b) In case if a research agency is trying to understand particular geographical Marketing environment for Financial Services Marketing, which particular factors it would ponder upon at Foundation level? Kindly elaborate. (5 Marks)

Cost & Management Accounting  Q1. The following is the summary of the receipts and issues of material in a factory during December 2007. Prepare Store Ledger according to First In First Out Method. December 2007 It was revealed that on 15th there was a shortage of five units and another on 27th of 8 units. (10 Marks) Q2. The anticipated material expense for project D-2 totals Rs. 5,000, with an expected direct labor cost of Rs. 1,000. In the machine shop, it necessitates 20 hours of machining by Machine No. 8 and 6 hours by Machine No. 11. The machine hour rates for Machine No. 8 and Machine No. 11 stand at Rs. 10 and Rs. 15 respectively. Last fiscal year, direct wages summed up to Rs. 80,000, while factory overheads (excluding those associated with Machine No. 8 and 11) amounted to Rs. 48,000. Similarly, the collective factory cost of all projects last year equaled Rs. 2,50,000, with office expenses reaching Rs. 37,500. To incorporate a 20% profit margin on the selling price, a quotation statement needs to be prepared. (10 Marks) Q3. A) How can you install a system of costing in a biscuit producing factory? What are the possible difficulties in installing such system? (5 Marks) B) Financial Accounting procedures are generally designed to ascertain the periodic profit or loss, but there are important limitations and deficiencies in the system.” Discuss. (5 Marks)

Corporate Finance 1. M/s Anuradha Ltd. has a long-term fund requirement of Rs. 45 lacs for putting up a new manufacturing unit. The following options of funding are available. a) It can raise a perpetual debt @ an interest rate of 9% p.a. b) It can issue bonds of Rs. 100 each, at a A discount of 10%. Coupon rate of 6%. Bonds have a term of 5 years. c) Issue Preference shares at a discount of 5%, redeemable at par after 6 years. Rate of Dividend is 8% d) Invest retained earnings to the extent of 50% and take a loan from the bank for the balance at 8.5% interest rate for a period of 4 years. Equity holders expect a return of 15% from the business. 2. Calculate the Cash Cycle for M/s ABC Traders Ltd. which is in the business of buying and selling garments. The following information is available for the firm. Opening Balances  Amt. Rs.  Inventory  10,000 Debtors  40,000 Creditors  10,000 Closing Balances Inventory  30,000 Debtors  60,000 Creditors  20,000 Costs Incurred during the year Total Purchases (50% on credit)  12,00,000 Selling Expenses  80,000 Administrative Expenses  25,000 Total Sales (80% on credit)  15,00,000 Assume 360 days in a year. The average cash cycle in the same industry is around 10 days. Comment on the cash cycle of M/S ABC Ltd. The Finance Manager is looking at the cash collection process critically and wants to reduce the Cash Cycle. What steps would you suggest her as her assistant? (10 marks) 3 a) Mr. Ramesh wants to plan to fund for his son’s education. He estimates that once his son is 21 years of age, he shall require to make a provision of about Rs. 5,00,000 for his college fees. His son is now 15 years of age. How much shall Mr. Ramesh invest today to make adequate provisions? He is also contemplating to make a fixed investment every year instead of a total investment today. How much should he invest each year to get the same amount of fees? The current rate of interest is around an average of 8%. (5 marks) b) Prepare cash budget of M/s Nirma Ltd. with the following information available. Jan. 23  Feb. 23  Mar. 23 Sales  200,000  150,000  265,000 Raw Materials Purchase  160,000  135,000  190,000 Manufacturing Expenses  22,000  15,000  35,000 Selling & Other Expenses  10,000  9,000  10,000 Opening Cash balance was Rs. 15000 for Jan. 23. Opening Debtors were Rs. 52500. Sales are typically 75% in cash and 25% credit, which are received in next month. There was a scheduled loan repayment of Rs. 25000 in Feb. 23. All expenses are assumed to be paid for in cash. (5 marks)

Capital Market and Portfolio Management  Q1. There are different users of financial statements like supplier, customer, investors etc. It is very necessary to check all financial statements & to do proper analysis before taking any business decision. Fundamental analysis is very helpful to understand company’s financial status. Elaborate different types of fundamental analysis which are necessary while taking any kind of business decision. (10 Marks) Q2. An efficient market is one that rapidly and completely possesses all the information related to the prices of the assets. In this market, stock prices cannot be change with rumors’ that are not verified by investors. Efficient market theory is classified in to four categories elaborate it. (10 Marks) Q3. a.) Suppose the expected return from the market is 15%. The risk free rate is 5% & beta for the stock is 1.5. Find the expected return for the stock. (5 Marks) b.) Capital Asset Pricing Model is a financial model used to rate risky securities, which examine the link between risk & return. CAPM helps to calculate the expected rate of return for an asset or investment. But CAPM have some disadvantages explain those limitations. (5 Marks)