Commerce (English Medium) कक्षा १२ - CBSE Question Bank Solutions for Business Studies

Explain the following as factor affecting the choice of capital structure:

Cash flow position

Explain the following as factors affecting the choice of capital structure:

Cost of equity

Explain the following as factor affecting the choice of capital structure:

Floatation costs

Explain the following as factors affecting the choice of capital structure:

Stock-Market conditions

State any three points of importance of consumer protection and promotion of interests of consumers

How is training in an organisation beneficial ‘for employees’? State by giving any four reasons.

Explain the following as factors affecting the choice of capital structure:

Return on Investment

Explain the following as factors affecting the choice of capital structure:

Flexibility

Explain the following as factors affecting the choice of capital structure:

Risk Consideration

Explain the following as factors affecting the choice of capital structure:

Control

Explain any four factors that affect the choice of capital structure of a company. 

Company X is facing a lot of problems these days. It manufactures white goods like washing machines, microwave ovens, refrigerators and air conditioners. The company’s margins are under pressure and the profits and market share are declining. The production department blames marketing for not meeting sales targets and marketing blames production department for producing goods, which are not of good quality meeting customers’ expectations. The finance department blames both production and marketing for declining return on investment and bad marketing. State the quality of management that the company is lacking? What quality of management do you think the company is lacking? Explain briefly. What steps should the company management take to bring the company back on track?

Coordination is the essence of management. Do you agree? Give reasons.

What is meant by capital structure?

Sunrises Ltd. dealing in readymade garments, is planning to expand its business operations in order to cater to international market. For this purpose the company needs additional Rs. 80,00,000 for replacing machines with modern machinery of higher production capacity. The company wishes to raise the required funds by issuing debentures. The debt can be issued at an estimated cost of 10%. The EBIT for the previous year of the company was Rs. 8,00,000 and total capital investment was Rs. 1,00,00,000. Suggest whether issue of debenture would be considered a rational decision by the company. Give reason to justify your answer. (Ans. No, Cost of Debt (10%) is more than ROI which is 8%).

Decentralisation is an optional policy. Explain why an organisation would choose to be decentralised.

“Capital structure decision is essentially optimisation of risk-return relationship.” Comment.

The workers of a factory remain idle because of lack of knowledge of hi-tech machines. Frequent visit of engineer is made which causes high overhead charges. How can this problem be removed. (vestibule training)

Explain the term ‘Trading on Equity’? Why, when and how it can be used by company.

‘ No organisation can be successful unless it fills and keeps the various positions filled with the right kind of people for the right job.’ Elucidate