Skip to main content

Suggested answers November 2018 - Strategic Financial Management

Strategic Financial management SFM November 2018 Suggested answers


7(b)


Advantages of commercial papers:

  1. It is quick and cost effective way of raising working capital.
  2. Best way to the company to take the advantage of short term interest fluctuations in the market
  3. It provides the exit option to the investors to quit the investment
  4. They are cheaper than a bank loan
  5. As commercial papers are required to be rated, good rating reduces the cost of capital for the company
  6. It is unsecured and thus does not create any liens on assets of the company
  7. It has a wide range of maturity
  8. It is exempt from federal SEC and State securities registration requirements.

7 (c)

Pre Conditions of Effective Money Market

A well developed money market 
  • uses a broad range of financial instruments
  • Channelises savings into productive investments
  • Promote financial mobility in the form of inter sectoral flows of funds and
  • Faciliate the implementation of monetary policy by way of open market operations

Comments

Post a Comment

Popular posts from this blog

Suggested answers November 2018 - Advance accounting Old Course IPCC

November 2018 Following are answers, a care is taken to answer them correctly, however, if any mistakes are identified by you, kindly share with me, I would love to hear them and will incorporate changes accordingly. Question Covered in post 1(a), 1(b), 1(c), 1(d), 2, 3(a),  3(b), 4, 5(a), 5(b),  6(b), 7(a), 7(b), 7(c),  7(d), 7(e) Question Pending 6(a) 1(a) (i) Annual lease rent = Rs. 32,500 (ii) Income = 26,000, 32,500, 39,000 (iii) Depreciation = Rs. 20,000, Rs. 25,000, Rs. 30,000 1(b) (i) Prior period Item adjustment Prior Period A/c Dr. To Salary Payable Salary payable A/c Dr To Cash Prior period item shall be disclosed separately (ii) Wages with retrospective effect It is not taken as error or omission in the preparation of Financial statements and hence this is not a prior period item, additional liability of Rs. 75,000 shall be included in current year Salary 1(c) (i) Present obligation as a r...
28 comments
Read more

ICAI Suggested Answers Links

Course Paper Suggested Answers CA Final OLD Paper – 1 : Financial Reporting https://www.icai.org/post.html?post_id=10135 CA Final OLD Paper – 2 : Strategic Financial Management https://www.icai.org/post.html?post_id=10139 CA Final OLD Paper – 3 : Advanced Auditing and Professional Ethics https://www.icai.org/post.html?post_id=10145 CA Final OLD Paper – 4 : Corporate and Allied Laws https://www.icai.org/post.html?post_id=10150 CA Final OLD Paper – 5 : Advanced Management Accounting https://www.icai.org/post.html?post_id=10158 CA Final OLD Paper – 6 : Information Systems Control and Audit https://www.icai.org/post.html?post_id=10164 CA Final OLD Paper – 7 : Direct Tax Laws https://www.icai.org/post.html?post_id=10252 CA Final OLD Paper – 8 : Indirect Tax Laws https://www.icai.org/post.html?post_id=10253 CA Final NEW Paper-1: Financial Reporting...
2 comments
Read more

Suggested answers May 2018 - Advance accounting Old Course IPCC

Finally, prepared a suggested answers for all the questions except Q2 and Q4, just go through it and let me know if you have different opinion or point to solve it. 1(a) Provision to be made for warranty under AS29  Amount At 31st March 2017 = 80,000 X 2% + 50,000 X 3%           3,100 At 31st March 2018 = 50,000 X 2% + 180000 X 3%           6,400 Amount to be debited to SPL for 31st March 2018 Balance of provision required as on 31st March 2018           6,400 Less opening balance         (3,100) Amount debited to SPL           3,300 No provision for 80,000 for 31St March 2018 because  warranty has lapsed 1(b) ...
1 comment
Read more