SVKM`s NMIMS – Anil Surendra Modi School of Commerce

Term End Exam – Mock Exam Date:

Note: All questions are for 10 Marks each.
First Year (Sem 1)
Q1) What are the properties of indifference curve? How is oligopoly different from
monopolistic competition?

Q2) When Andrew Levine took over as president of Development Counsellors lnternational
(DCI), the public relations firm founded by his father in 1960, he was eager to try open-book
management. His first step was to add a financial segment to the monthly staff meeting, but
employees just seemed bored. Most of them had no interest or skills in finance, statistics, and
ratios.

Rather than providing standard training, Levine had an idea: Why not appoint a different
staffer each month to be CFO for the day. That person would be required to figure out the
financials and then present the financial reports at the monthly staff meeting. His first
appointment was the receptionist Sergio Barrios, who met with Levine and the company' s
chief financial officer to go over the figures, look at any unusual increases or decreases in
revenue or expenses, and talk about ideas to spark discussion. Levine was astounded by the
reaction of staffers at the monthly meeting. Unlike Levine or another manager, Barrios was
new to accounting and consequently explained things in a way that any lay person could
understand. In addition, employees wanted to support Barrios as "one of their own," so they
paid more attention and asked more questions.

At each monthly meeting, the CFO of the day goes through a breakdown of the company's
sales and expenses, points out irregularities and trends in the numbers, takes questions from
other staff members, and sparks discussion .of current financial issues. At the end of the
report, the person reveals the bottom line, indicating whether the company met its profit goal
for the month. Each time DCI’s accumulated profit hits another $ 100,000 increment during
the course of the year, 30 percent is distributed to employees.

DCI has been profitable ever since Levine began the CFO-of-the-day program. In addition,
employees are happier with their jobs, so turnover has decreased. Clients tend to stick around
longer too, because employees put more effort into building relationships. "Nobody wants to
see a zero next to their client in the income column," Levine says.

Question. Why did the CFO of the day program worked for DCI ? What is the importance of
financial controls in organizations? State the other types of Controls which is not mentioned
in this case study?

Q3) What are the Henry Fayol’s 14 Principles?

Q4) Explain the 5 levels of Maslow need hierarchy theory?

Q5) ABC Trading Co. Calcutta purchased Furniture on 1st April 2015 for 25, 000. In the same
year additional furniture was purchased for 10, 000 on 1st October 2015. On 1st October 2016,
the Furniture purchased on 1st April, 2015 was sold for 15,000 and on the same date new
Furniture was purchased for 12, 000.The company charge depreciation @ 8% p.a. on
Diminishing Balance Method. Prepare Furniture Account & PFD A/c for 2015-16, 2016-17 &
2017-18, assuming that the accounting year closes on 31st March every year.
Second Year (Sem 3)
Q1) Explain the importance of Ratio Analysis.

Q2) Mr. Keshavnath, ex Indian cricketer, submits the following information of stay outside
India for the year ending 31/3/2020.

Days Place
13/4/2019 to 28/4/2019 Bangladesh for Bilateral series
3/5/2019 to 9/7/2019 ICC Champions trophy in England
27/8/2019 to 10/9/2019 Triangular series in South Africa
15/9/2019 to 1/10/2019 World Cup in New Zealand
4/1/2020 to 26/3/2020 Club Cricket in Australia
He made his debut in International cricket on 11/3/2017. Then in a match against Ireland, he
suffered major injury necessitating two years’ hospitalization in UK. He recovered and
returned back to India on 29/3/2019. Thereafter, he continued to play for Team India.
Determine his residential status for the previous year ended 31/3/2020.

Q3) A product is currently being manufactured on a machine that has a book value of Rs.
30,000. The machine was originally purchased for Rs. 60,000 ten years ago. The per unit costs
of the product are:
Direct labour Rs. 8 direct materials Rs. 10 variable overheads Rs. 5 fixed overheads Rs. 5 and
total is Rs. 28. In the past year 6,000 units were produced and sold for Rs. 50 per unit. It is
expected that the old machine can be used indefinitely in the future.
An equipment manufacturer has offered to accept the old machine at Rs. 20,000, a trade – in
for a new version. The purchase price of the new machine is Rs. 1,00,000. The projected per
unit costs associated with the new machine are:
Direct labour Rs. 4 direct materials Rs. 7 variable overheads Rs. 4 fixed overheads Rs. 4 fixed
overheads Rs. 7 and total is Rs. 22.
The management also expects that if the new machine is purchased, the new working capital
requirement of the company would be less by Rs. 10,000. The fixed overheads costs are
allocations from other departments plus depreciation of the equipment. The new machine
has an expected life of ten years with no salvage value; the straight line method of
depreciation is employed by the company. It is also expected that the future demand of the
product would remain at 6,000 units per year. Should the new equipment be acquired?
Corporate tax is @ 40%
[present value of annuity of Re.1.00 at 10% rate of discount for 9 years is 5.759
Present value of Re. 1.00 at 10% rate of discount, received at the end of 10th year is 0.386)
Q4) Maximize Z = 3x1 + 2x2

Subject to the constraints

𝑥1 + 𝑥 2≤ 7

2𝑥1 + 𝑥 2≤ 8

−𝑥1 + 𝑥 2≥2

𝑥1, 𝑥 2≥0

Solve graphically. Use Iso-profit line method.

Q5) In case of Net Present Value and Internal Rate of Return giving contrasting rankings for
two projects, how can one take a decision?
Third year

Q1)
a)

Consider the following data of an International fund

Particulars Rs. in crores
Investment 2250
Receivable 175
Accrued Income 62
Other current assets 673
Liabilities 725
Accrued expenses 115
No. of units outstanding 175
Public offer price p.u. 13.52

Calculate the sales charge % on Public Offer Price

b) Explain types of mutual funds.

Q2) Explain the concept of Tracking Error with the help of an example

Q3) In August 2016, Tata Chemicals said it will sell its business of distribution of urea
fertilisers manufactured at Babrala, Uttar Pradesh to Yara Fertilisers India for Rs. 2,670 crore
to unlock value and exit non-core operations. Tata will continue to own the Paras, TKS &
Daksha brands. Also, this transaction does not include specialty products & complex
fertilisers. The Babrala plant has an annual production of 0.7 million tonne ammonia & 1.2
million tonne urea and generated revenues of $350 million & EBITDA of $35 million in the
financial year ended March 31, 2016.
Question: Explain the Divestment Strategy. Apart from the reasons mentioned above, what
could be the other reasons for Divestment for an organization? Support your answer with
examples.

Q4)
Fiat, based in Turin, Italy, is an engine and automobile manufacturer. Tata Motors (part of the
Tata Group) was established in 1945 and today commands leadership position in commercial
vehicles segment in India and is the world’s 4th largest truck manufacturer & 3rd largest bus
manufacturer. The Tata-Fiat relationship began in 2005 with a distribution & service strategic
alliance whereby Tata Motors was responsible for the sales & service of Fiat cars in India. The
relationship was then scaled up to form a 50:50 Joint Venture, Fiat India Automobiles Limited
(FIAL), in October 2007, under which both the companies agreed to joint distribution, back-
end support system and co-manufacturing of products including engine at Fiat’s facility at
Ranjangaon. The JV however, did not live up to expectations and both Fiat & Tata Motors
suffered losses. Analysts attributed the company’s miserable performance to its inefficiency
in managing its dealerships, non-availability of spare parts, bad customer service, and a string
of marketing and distribution glitches which had tarnished its image. In September 2011, FIAL
announced that Fiat would exit the joint venture.
Question: Explain the strategies of Joint Venture and Strategic Alliance along with their
types. Also, what was the type of Strategic Alliance and Joint Venture was seen between Fiat
and TATA? Justify?

Q5) You are the brand manager of a new line of light weight, economically priced mobile
phone. Describe how an understanding of consumer behaviour will help you in your
segmentation strategy and promotion strategy. Explicate the interrelationship between
Consumer Behaviour and Marketing Mix Strategies with suitable examples.