G9 by Business Studies

aarushimehta0623 — 2024-08-28 15:41:42 UTC

Q1. Kaysons Ltd. was a reputed company manufacturing automotive parts for electric vehicles. As the demand for the electric vehicles grew, Kaysons Ltd. needed more capital to keep up with the demand for automotive parts. Atul, the Finance Manager of Kaysons Ltd. suggested that the company should raise funds through a public issue of shares as the stock market was bullish. The Chief Executive Officer fully understood that this process of raising funds would not only reduce the managements' holding in the company but would also require considerable expenditure. Even then he agreed with the Finance Manager and the public issue of shares was made complying with the guidelines of Securities and Exchange Board of India.

Identify and state four factors affecting choice of capital structure being discussed above. [4]

aarushimehta0623 — 2024-08-28 15:41:42 UTC

Q2. Harish is working as a finance manager in 'Kozee Softwares Ltd.' He has been awarded 'Best employee of the year Award' because of his foresightedness. He always aims at smooth operations of all the financial activities by focusing on fund requirements and their availability in the light of financial decisions. He takes into consideration the growth, performance, investments and requirement of funds for a given period so that financial resources are not left idle and don't unnecessarily add to the cost. By doing all this Harish strives to achieve the two main objectives of an important concept of financial management.

Identify the concept and explain its two objectives. [3]

aarushimehta0623 — 2024-08-28 15:41:42 UTC

Q3. ‘R.K. Fertilizers Ltd.’ has planned to set up a plant for manufacturing urea fertiliser which has very high market potential as there is excess demand as compared to supply. The company is planning to operate at a higher scale which will require a bigger plant, more space, etc. The company has also planned to replace its plant and machinery as the same are prone to obsolescence with the change in technology. To meet the growing demand of fertilisers that may result in increase in profits, the company is also planning to diversify its operations. It wants to enter in the area of cement manufacturing. Thus, it is a capital-intensive project involving an investment of ₹3,000 crore.

Identify and state any four factors affecting the fixed capital requirements of ‘R.K. Fertilisers Ltd.’ discussed in the above para. [4]

aarushimehta0623 — 2024-08-28 15:41:42 UTC