Business Administration 2014

[M Manzoor]

Business Administration 2014

1. 20 objectives (MCQs paper was not given to candidates)
Part A
2. Discuss the contingency factors that affect planning. Discuss how managers can effectively plan in today's world?
3. What issues do today's leaders face? Do you think that most managers in real life use a contingency approach to increase their leadership effectiveness?
Part B
4. What constitutes good marketing research? How can company correctly measure and forecast demand?
5. How can companies evaluate and select specific foreign markets to enter? What are the differences between marketing in a developing and developed market?
Part C
6. How is a net present value profile used to complete projects? What causes conflicts in making of projects via net present value and internal rate of return?
7. How are total risk, non- diversifiable risk, and diversifiable risk selected? Why is non-diversifiable risk the only relevant risk?
8. The financial statement of the Remington Pharmaceuticals for Year ended Dec 31, 2012, follow’
Remington Pharmaceuticals Income Statement
For the Year Ended Dec 31, 2012
Sales Revenue 160,000
Less: Cost of Goods Sold (106,000)
_________
Gross Profit 54,000
Less Operating Expenses
Selling Expenses 16,000
General administrative Expenses 10,000
Lease Expense 1,000
Depreciation expense 10,000
______
Total Expenses 37,000
______
Operating profit 17,000
Less: Interest Expense 6,100
______
Net profit Before taxes 10,900
Less: Taxes 4,360
_____
Net profit after taxes 6,540
_____



Remington Pharmaceuticals Balance Sheet
As on Dec 31, 2012
Assets
Cash $ 500
Marketable securities 1,000
Accounts Receivables 25,000
Inventories 45,500
Total Current Assets 72,000

Equities and Liabilities
Accounts payable 22,000
Notes Payable 47,000
Total Current Liabilities 69,000
Long term debt 22,950
Common Stock equity 31,500
Retained earnings 26,550
Total Liabilities and Retained earnings 150,000

Total firm’s 3000 stock outstanding shares of common stock closed on 2012 at a price of $ 25 per share

a. Use the preceding financial statements to complete following table assume industry average given in table are applicable for both 2011 and 2012

Ratio Industry average 2011 2012
Current Ratio 1.80 1.844 -----
Quick Ratio 0.70 0.78 -----
Inventory turnover* 2.50 2.59 -----
Average collection period* 37.5 days 36.5 days - ---
Debt ratio 65% 67% -----
Times interest earned ratio 3.8 4.0 -----
Gross profit margin 38% 40% -----
Net profit margin 3.5% 3.6% -----
Return on total assets 4.0% 4.0% -----
Return on equity 9.5% 8% -----
Market/Book ratio 1.1 1.2 - ------
*bases on 365 days a year and end of year figures

[M Manzoor]