B Assignment Set- 2 60 Marks Note: Answer all questions with to words each must be written within pages. An accountant finds that the trial balance of his client did not tally and it showed an excess credit of Rs.
Marketing and advertising expenditure can be reduced by 40 per cent. Keeping in mind the investor confidence that the company enjoys, he feels that the company can forgo paying dividends in the recession period. He goes with his worked out statement to the Director Finance, Mr.
Arthashatra, and advocates raising Rs. Longsighted carefully analyses Mr.
He points out the following: Certain management policies like those relating to dividend payout, send out important signals to the investors. The firm should pay at least 10 per cent dividend in the recession years. Shortsighted has used the accounting profits to determine the amount available each year for servicing the debt obligations.
This does not give the true picture. Net cash inflows should be used to determine the amount available for servicing the debt. Net Cash inflows are determined by an interplay of many variables and such a simplistic view should not be taken while determining the cash flows in recession.
It is not possible to accurately predict the fall in any of the factors such as sales volume, sales price, marketing expenditure and so on.
Probability distribution of variation of each of the factors that affect net cash inflow should be analyzed. The management recognizes that the alternative suggested by Mr. Longsighted rests on data, which are complex and require expenditure of time and effort to obtain and interpret. Considering the importance of capital structure design, the Finance Director asks Mr.
Longsighted to carry out his analysis. Information on the behaviour of cash flows during the recession periods is taken into account. The methodology undertaken is as follows: Longsighted comes up with a range of estimates of the cash flow in future recession periods based on all possible combinations of the several factors.
He also estimates the probability of occurrence of each estimate of cash flow. Assuming a normal distribution of the expected behaviour, the mean expected value of net cash inflow in adverse conditions came out to be Rs.
Keeping in mind the looming recession and the uncertainty of the recession behaviour, Mr. Arthashastra feels that the firm should factor a risk of cash inadequacy of around 5 per cent even in the most adverse industry conditions.
Thus, the firm should take up only that amount of additional debt that it can service 95 per cent of the times, while maintaining cash adequacy. To maintain an annual dividend of 10 per cent, an additional Rs.
Hence, the expected available net cash inflow is Rs. Analyse the debt capacity of the company. The sales of Greaves Limited has increased from Rs crore in to Rs crore in How has the company performed?
The following question need answer to fully understand the performance of the company:FINANCIAL MANAGEMENT WE ARE PROVIDING CASE STUDY ANSWERS. ASSIGNMENT SOLUTIONS, PROJECT REPORTS. AND THESIS. ISBM / IIBMS / IIBM / ISMS / KSBM / NIPM - SEC, as part of its routine financial accounting system, had collected the actual expenses for the month of April, by 5th of May.
Some of the . Jul 30, · Guidelines that arise from the practical application of accounting principles. An accounting convention is not a legally-binding practice; rather, it is a generally-accepted convention based on customs, and is designed to help accountants overcome practical problems that arise out of the preparation of financial statements.
assignment fall mbads / mbahcsn3 / mban2 / pgdban2 / mbaflex i mb & financial and management accounting b 4 60 Marks Total Marks Criteria webkandii.com Inventory in a business is valued at the end of an accounting period, at either cost or market price, 1 whichever is lower.
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MB – Financial and Management Accounting - 4 Credits (Book ID: B ) Assignment- 60 marks. Note: Answer all questions. Kindly note that answers for 10 . StarTutor's Review Ivy is a very professional and committed teacher. Her passion for teaching has led her to leave the corporate world in Feb to teach full time, and she already has plans to upgrade herself further in NIE and take up a full-time teaching career in future.