Class: 11 || Subject: Elements of Finance-I
Unit-4 Financial Assets
Theoretical Questions
- List out the instruments of financial assets. [5]
- Write about the role of financial institution in financial market. [5]
- What is bond? Write the features of bond. [5]
- Write in brief the characteristics of financial assets. [5]
- Write about different types of Bonds. [5]
- What do you understand by financial assets? Enumerate the different types of government securities. [2+3]
- On the basis of Issuer, describe various types of instruments of financial assets. [5]
- Write the meaning of real and financial assets. Mention any two differences between real and financial assets. [3+2]
- What do you mean by Tele-banking instruments? State its any three features. [2+3]
- Differentiate between long term and short and short securities with their meaning. [5]
- Differentiate between real assets and financial assets. [5]
- Differentiate between common stock and bond. [5]
- What do you understand by financial assets? Enumerate its characteristics. [5]
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Numerical Problems
- The capital and liabilities of a company are as under:
Creditors Rs. 2,50,000
Bill payable Rs. 3,00,000
10% Debenture Rs. 3,00,000
Common Shares of Rs. 1,000 each; Authorized capital 10,000 shares, issued 7000 shares
Retained earnings Rs. 1,00,000
Required:
i. Book value per share
ii. Book value per share if the remaining shares are issued
Ans: i. Rs. 114.29 ii. Rs. 110
15. The balance sheet of a company at the end of Chaitra 2072 is given below:
| Rs. | Rs. | ||
| Current assets | 8,00,000 | Account payable | 2,50,000 |
| Fixed assets | 24,00,000 | Notes payable | 1,50,000 |
| Long term debt | 5,00,000 | ||
| Common shares (Authorized 30,000 shares, Issued 20,000 shares) | 20,00,000 | ||
| Share premium | 2,00,000 | ||
| Retained earnings | 1,00,000 | ||
| Total assets | Rs.32,00,000 | Total Liabilities & Equity | Rs. 32,00,000 |
Required:
a. Book value per share
b. If remaining authorized shares were sold at Rs. 125 per share, calculate the book value per share.
Ans: a. Rs. 115 b. 118.33
16. Following information are provided:
Common stock, Rs. 100 per value Rs. 6,00,000
Share premium Rs. 2,00,000
Retained earnings Rs. 4,00,000
Common equity Rs. 12,00,000
Less treasury stock, 1,000 shares Rs. 1,50,000
Net common equity Rs. 10,50,000
Required:
i. Number of shares outstanding
ii. Book value per share
Ans: i. 4,500 shares ii. 233.33
17. The liabilities side of balance sheet of Koshi Metal Company consists of the following:
Account payable Rs. 1,00,000
Notes payable Rs. 2,00,000
Long term debt Rs. 3,00,000
Common stock (50,000 shares authorised, 25,000 shares outstanding)
Retained earnings Rs. 4,00,000
Total liabilities and equity Rs. 15,00,000
Required: Calculate:
i. The book value per share of Co.’s common stock?
ii Suppose the Co. show the remaining authorized shares and netted Rs. 30 per share from the sale. What would be the new book value per shares?
Ans: i. Rs. 36 ii. Rs. 33
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