IGNOU MS41 Solved Assignment
| University | IGNOU (Indira Gandhi National Open University) |
| Program | MBA – MP/MPB/PGDFM |
| Course Code and Course Title | MS-41: Working Capital Management |
| Assignment Code | MS-41/TMA/JAN/2022 |
| Validity of Assignment | 30th April 2022 and 31st October, 2022 |
| Date of Submission | Last date of submission for January 2022 session is 30th April, 2022 and for July 2022 session is 31st October, 2022. |
Q1. Discuss the Role of Central Bank in designing and implementing monetary and credit policy. What are the important policy measures announced as a part of the latest credit policy.
Q2. You are to prepare Cash Flow Statement from the Balance Sheets of alpha Ltd.
| Assets | 2020 (Rs.) | 2021 (Rs.) | Liabilities | 2020 (Rs.) | 2021 (Rs.) |
| Buildings | 8,00,000 | 10,00,000 | Share Capital | 17,00,000 | 18,35,000 |
| Plant & Machinery | 2,50,000 | 3,70,000 | Reserves | 40,000 | 83,700 |
| Fixtures & Fittings | 5,000 | 6,000 | Profit & Loss
appropriation A/c |
1,00,000 | 1,30,000 |
| Cash | 2,000 | 2,200 | Provision for Dividends | 70,000 | 50,000 |
| Debtors | 1,00,000 | 45,000 | Creditors | 1,00,000 | 95,000 |
| Accounts Receivable | 8,000 | 9,000 | Bank Overdraft | 8,000 | 18,000 |
| Stock | 4,00,000 | 3,43,700 | Bills Payable | 14,000 | 13,000 |
| Prepaid Expenses | 3,000 | 3,100 | Loan on Mortgage | 10,000 | 70,000 |
| Investments | 1,64,000 | 1,70,000 | |||
| Goodwill | 3,00,000 | 3,43,700 | |||
| Preliminary Expenses | 10,000 | 2,000 | |||
| 20,42,000 | 22,94,700 | 20,42,000 | 22,94,700 |
Additional information
(i) Depreciation is charged on building at 3 percent of cost of Rs. 9,00,000 on plant; machinery at 8 percent of cost Rs. 4,00,000 and fixtures & fittings at 5 percent of cost Rs. 8,000.
(ii) Interest received Rs. 3,000 on investments was used in writing down the book value of investments.
(iii) Dividends declared for 2020 was paid and interim dividend of Rs. 20,000 was paid out of Profit & Loss Appropriation Account.
Q3. What is a Commercial Paper (CP)? Discuss the terms and conditions laid down by companies for issuing CP. Describe the procedure followed in India for issuing commercial paper.
Q4. If you are a manager of an MNC, under what circumstances would you consider using Euro Currency markets? What advantages or disadvantages these markets would offer compared to borrowing from domestic markets?
Q5. Taking a suitable example explain how maximum permissible bank finance is determined under the three methods of lending.