Section C (4 Mark)
To create a common size income statement ____________ all items on the income statement by ____________.
Section A (1 Mark)
In US which of the following does not count as an itemized deduction on income tax?
Section B (2 Mark)
Ajay is considering to purchase a house which will bring rental income of Rs. 15,000/- p.m at the end of month. Ajay is looking for 12% returns and he is expecting to sell the property after 5 years for Rs. 6 lac. What price Ajay should pay for this property now?
Section B (2 Mark)
In 2011-12, Steven has business profits of £34,125, net bank interest of £1,240 and net dividends of £9,000. He claims the personal allowance of £7,475. What is the income tax payable for the year after subtracting tax deducted at source?
Section B (2 Mark)
You have been asked to estimate the market value of an apartment complex that is producing annual net operating income of Rs44,500. Four highly similar and competitive apartment properties within two blocks of the subject property have sold in the past three months. All four offer essentially the same amenities and services as the subject. All were open-market transactions with similar terms of sale. All were financed with 30-year fixed-rate mortgages using 70 percent debt and 30 percent equity. The sale prices and estimated first-year net operating incomes were as follows:
What is the indicated value of the property using direct capitalization?
Section C (4 Mark)
Which of the following statements is/are correct?
Section C (4 Mark)
Belstate reported net income of Rs221 million in 1993 on revenues of Rs8298 million. It paid out 31% of its earnings as dividends, a payout ratio that is expected to remain level from 1994 to 1998, during which period earnings growth is expected to be 13.5%. After 1998, earnings growth is expected to decline to 6%, and the dividend payout ratio is expected to increase to 60%. The beta is 1.15 and this figure is expected to remain unchanged. The treasury bill rate is 7%.
Estimate the price/sales ratio for Walgreens, assuming its profit margin remains unchanged at 1993 levels.
Section C (4 Mark)
Mr. Chopra runs a Garment Factory, he is very concerned about his retirement and wants you to help him out in planning for it. His Current annual expenses are Rs. 12,00,000 which would be rising at an annual rate of 8% pre- retirement and 2% post retirement. His current age is 50 years and he wants to work till the age of 65. The expected life expectancy in his family is 75 years. Calculate the monthly contribution he must make till his retirement if the pre- retirement returns are 12% p.a. compounded monthly and post-retirement returns are 8% p.a compounded annually.
Section A (1 Mark)
Which of the following statements regarding debit and credit card liability is correct?
Section C (4 Mark)
Yogesh Jain is a Chartered Accountant by profession and a very disciplined investor he has started investing from today in an account Rs. 1,00,000 every year (beginning of year) and plans to increase his contribution by 10% every year. If the ROI he gets is 15% per annum compounded half yearly calculate the corpus he would be able to accumulate in 25 years.
Section B (2 Mark)
Interest on UK government securities is exempt from UK income tax if the recipient is not ___ in the UK.
Section A (1 Mark)
Select the CORRECT statement regarding basis risk associated with futures.
Section A (1 Mark)
“Early accumulation” life stage is normally during ______
Section B (2 Mark)
Which of the following activities is/are a part of “Building the CRM project foundation phase “in CRM implementation?
Section C (4 Mark)
Mr. XYZ sells a Nifty Put option with a strike price of Rs. 4000 at a premium of Rs. 21.45 and buys a further OTM Nifty Put option with a strike price Rs. 3800 at a premium of Rs. 3.00 when the current Nifty is at 4191.10, with both options expiring on 31st July.
What would be the Net Payoff of the Strategy?
• If Nifty closes at 3980.55
• If Nifty closes at 4800
Section C (4 Mark)
Management has recently announced that expected dividends for the next three years will be as follows:
For the subsequent years, management expects the dividend to grow at 5% annually. If the risk-free rate is 4.30%, the return on the market is 10.30% and the firm’s beta is 1.40. What is the maximum price that you should pay for this stock?
Section B (2 Mark)
Jaipur Golden Railroad reported net income of Rs770 million in 1993, after interest expenses of Rs. 320 million. (The corporate tax rate was 36%.) It reported depreciation of Rs.960 million in that year, and capital spending was Rs1.2 billion. The firm also had Rs. 4 billion in debt outstanding on the books, rated AA (carrying a yield to maturity of 8%), trading at par (up from Rs3.8 billion at the end of 1992). The beta of the stock is 1.05, and there were 200 million shares outstanding (trading at Rs 60 per share), with a book value of Rs5 billion. Jaipur Golden paid 40% of its earnings as dividends and working capital requirements are negligible. (The treasury Bill rate is 7%.)
Estimate the free cash flow to the firm in 1993.
Section B (2 Mark)
Ashish is bullish about HLL which trades in the spot market at Rs.210. He buys 10 three-month call option contracts on HLL with a strike of 230 at a premium of Rs.1.05 per call. Three months later, HLL closes at Rs. 250. Assuming 1 contract = 100 shares, his profit on the position is ___________.
Section C (4 Mark)
Read the senario and answer to the question.
What would be the taxable amount on gratuity received by Jogen, if he would retired from an organization where employees are not covered under Gratuity Act?
Section B (2 Mark)
Profitability Index is
Section C (4 Mark)
Arvind Ltd. currently EPS is Rs.5. Its return on equity (ROE) is 25% and it retains 60% of its earning. Stocks of similar risk are priced to return 18%. What is the intrinsic value of Arvind Ltd’s Stock?
Section A (1 Mark)
Tax exemption limit for the lump sum received towards Leave encashment on retirement is at _______________
Section A (1 Mark)
An investor will take as large a position as possible when an equilibrium price relationship is violated. This is an example of _________.
Section C (4 Mark)
Zoya Ltd has the following Balance sheet for FY 2005-2006:
The Total Sales for the year was Rs. 6,00,000.
The company president believes the company carries excess inventory. Accordingly he wants the inventory turnover ratio to be 8x and would use the freed up cash to reduce current liabilities. If the company follows the president’s recommendation and sales remain the same, the new quick ratio would be:
Section A (1 Mark)
Which of the following statements about Real Estate Investment Trusts is/are true?
Section C (4 Mark)
As a CWM you are required to calculate the tax liability of an individual whose taxable income is:
• $ 83560 in SGD and he is a Singapore citizen
• £ 73150p.a (only employment) and he is a UK citizen
Section C (4 Mark)
Read the senario and answer to the question.
If Mrs. Deepika, a conservative investor, has Rs. 50, lakhs today that she could invest for the next three months in a three month bank CD or in a stock .The bank CD offers a guaranteed return 6 % over the three-month period. Alternatively she thinks the price of the stock will rise by 5% over the next months. She is confused in taking the decision. Guide her in trade off between return and risk so that she makes a decision in choosing investments?
Section B (2 Mark)
An investor is considering the purchase of a small office building and, as part of his analysis, form the following given data calculate the Net Operating Income (NOI).
Section B (2 Mark)
Ram and Mrs. Ram hold 20% and 30% equity shares in Anand Ltd. respectively. They are employed in Anand Ltd. (monthly salary being Rs.20000 and Rs. 30000 respectively) without any technical / professional qualification.
Other incomes of Ram and Mrs. Ram are Rs. 70000 and Rs. 100000 respectively. The net income of Ram and Mrs. Ram for the assessment year 2013-14 shall be.
Section A (1 Mark)
According to the __________________ if irrational traders cause deviations from fundamental value, rational traders will often be powerless to do anything about it.
Section A (1 Mark)
When the sponsored entities creates CMOs they often use different _____________ which each promise a different coupon rate and which have different maturity and risk characteristics.
Section A (1 Mark)
An Agreement entered into between the Sellor and Buyer for transfer of the right / ownership of the property on an outright sale/purchase is known as __________.
Section B (2 Mark)
Which of the following are the two skills associated with being a good listener?
Section C (4 Mark)
Mr. A bought XYZ Ltd. For Rs. 3850 and simultaneously sells a call option at an strike price of Rs. 4000. Which means Mr. A does not think that the price of XYZ Ltd. will rise above Rs. 4000. However, incase it rises above Rs. 4000, Mr. A does not mind getting exercised at that price and exiting the stock at Rs. 4000 (Target Sell Price = 3.90% return on the stock purchase price). Mr. A receives a premium of Rs. 80 for selling the call. Thus net outflow to Mr. A is (Rs. 3850 – Rs. 80) = Rs. 3770. He reduces the cost of buying the stock by this strategy.
What would be the Net Payoff of the Strategy?
• If XYZ closes at 3350
• If XYZ closes at 4800
Section A (1 Mark)
Hedge funds often seek to take advantage of market inefficiencies such as:
Section B (2 Mark)
Accrued Interest on loan for self occupied property is Rs.110000 till 31 March 2010. Loan was taken for construction on 31/07/2006 and construction completed on 03/04/10. Interest for the year 2010-11 is Rs 22000. Determine what interest shall be allowed u/s 24(b) for AY 2011-12.
Section B (2 Mark)
Which of the following statements is/are correct?
Section A (1 Mark)
Which of following is not an exclusion under a health policy?
Section B (2 Mark)
Mr. A gifted debenture of Rs. 100000 to his wife. She received Rs. 10000 interest which she reinvests and earns Rs. 1000. This Rs. 1000 will be taxable in the hands of
Section A (1 Mark)
Depending on how questions are asked, ___________ can cause investors to communicate responses to questions about risk tolerance that are either unduly conservative or unduly aggressive.
Section A (1 Mark)
Accumulation, preservation and distribution are stages of
Section B (2 Mark)
Which one of the following statements is/are correct?
Section A (1 Mark)
A bank is considering making a loan to Sumit Nayyar. Mr. Sumit has Rs 1,00,000 in the bank right now but generally keeps a balance of Rs 4,50,000 most of the year. What aspect of evaluating a consumer loan application is this fact concerned with?
Section A (1 Mark)
Following is/ are the component(s) of Personal Financial Statements
Section A (1 Mark)
A(n)______________________ loan is a short- or medium-term loan repayable in two or more consecutive payments, usually monthly or quarterly.
Section A (1 Mark)
In The CAMPARI model of Credit evaluation ‘C’ stands for:
Section C (4 Mark)
Azhar aged 30 is a disciplined investor. He has started depositing Rs. 25,000 every year in an account that pays a return of 9% every year. He plans to increase his contribution by Rs. 5000 every year till his age 50. Calculate the amount he would be having in his account at this age.
Section C (4 Mark)
Azhar deposits Rs. 12,500 in an account that pays a ROI of 20% p.a compounded annually on 5th. Of March 2010. Calculate the date on which the balance in his account would be Rs.35,338/-
Section A (1 Mark)
H Ltd, a UK resident company, owns 100% of the share capital of two other UK companies and 80% of the share capital of T SA, a company resident in Italy.H Ltd has three associated companies.
Section C (4 Mark)
Suppose Gaurav, an investor, is looking to add to his portfolio and hears about a potential investment through a friend, Hitesh, at a local coffee shop. The conversation goes something like this:
GAURAV: Hi, Hitesh. My portfolio is really suffering right now. I could use a good long-term investment. Any ideas?
HITESH: Well, Gaurav, did you hear about the new IPO [initial public offering] pharmaceutical company called Pharma Growth (PG) that came out last week? PG is a hot new company that should be a great investment. Its president and CEO was a mover and shaker at an Internet company that did great during the tech boom, and she has Pharma Growth growing by leaps and bounds.
GAURAV: No, I didn’t hear about it. Tell me more.
HITESH: Well, the company markets a generic drug sold over the Internet for people with a stomach condition that millions of people have. PG offers online advice on digestion and stomach health, and several Wall Street firms have issued “buy” ratings on the stock.
GAURAV: Wow, sounds like a great investment!
HITESH: Well, I bought some. I think it could do great.
GAURAV: I’ll buy some, too.
Gaurav proceeds to pull out his cell phone, call his broker, and place an order for 100 shares of PG.
Which of the following biases have been exhibited by Gaurav?
