Management — UPSC Mains Optional PYQ (2023–2025)

ABC Technologies, a company producing high-tech components, is considering a significant expansion of its production capacity. This expansion will involve substantial fixed costs in new machinery and equipment, and they are also considering increasing their debt financing. The following information is available: Current Situation: Fixed Operating Costs – ₹ 20,00,000·00 Variable Operating Costs per unit – ₹ 50·00 Selling Price per unit – ₹ 150·00 Current Production and Sales – 50,000 units Current Interest Expense – ₹ 10,00,000·00 Expansion Plan: Increased Fixed Operating Costs – ₹ 35,00,000·00 Increased Interest Expense – ₹ 18,00,000·00 Expected increase in Production and Sales – 20,000 units

What is Money Market? Elaborate its key functions in the financial system. Include specific examples of widely used money market instruments and the institutions that deal in them.

“Well differentiated products create a significant competitive advantage and a distinctive aura for themselves.” Analyse the statement and discuss the various attributes on the basis of which products can be successfully differentiated.

Sunder Ltd. is planning an expansion programme which will require ₹30 crores and can be funded through one of the three following options: 1. Issue equity shares of ₹100 each at par 2. Raise a 15% loan, and 3. Issue 12% preference shares The present paid-up capital is ₹60 crores and the annual EBIT is ₹12 crores. The tax rate may be taken at 30%. After the expansion plan is adopted, the EBIT is expected to be ₹15 crores. Calculate the EPS under all the three financing options indicating the alternative giving the highest return to the equity shareholders. Also determine the indifference point between the equity share capital and the debt financing (i.e. option 1 and option 2 above).

Directors of ABC Ltd. wish to diversify. Presently, ABC Ltd. is into selling finished goods from its own godown. ABC Ltd. issued debentures on 07-04-2022 and purchased fixed assets on the very same day. The purchase prices are assumed to have remained stable during the concerned period. Following financial information is available to you: INCOME STATEMENT (₹) 2021-22: Cash sales 30,000; Credit sales 2,70,000; Less: Cost of goods sold 2,36,000; Gross profit 64,000; Less: Operating expenses – (i) Warehousing 13,000 (ii) Transport 6,000 (iii) Administrative 19,000 (iv) Selling 11,000; Net profit 15,000. 2022-23: Cash sales 32,000; Credit sales 3,42,000; Less: Cost of goods sold 2,98,000; Gross profit 76,000; Less: Operating expenses – (i) Warehousing 14,000 (ii) Transport 10,000 (iii) Administrative 19,000 (iv) Selling 57,000; Net profit 19,000. BALANCE SHEET (₹) Assets & Liabilities 2021-22 2022-23 Fixed Assets (Net Block) – 30,000 – 40,000 Receivables 50,000 82,000 Cash at Bank 10,000 7,000 Stock 60,000 94,000 Total Current Assets (CA) 1,20,000 1,83,000 Payables 50,000 76,000 Total Current Liabilities (CL) 50,000 76,000 Working Capital (CA-CL) 70,000 1,07,000 Net Assets 1,00,000 1,47,000 Represented by: (i) Share capital 75,000 75,000 (ii) Reserve & Surplus 25,000 42,000 (iii) Debentures – 30,000 1,00,000 1,47,000 You are required to calculate the following ratios for the years 2021-22 and 2022-23: (i) Gross Profit Ratio (ii) Operating expenses to sales ratio (iii) Operating profit ratio (iv) Capital turnover ratio (v) Stock turnover ratio (vi) Net profit to Net worth ratio (vii) Receivables collection period Ratio relating to capital employed should be based on the capital at the end of the year. Give the reasons for change in the ratios for two years. Assume opening stock of ₹10,000 for the year 2021-22. Ignore taxation.

(a) "Span of management plays important role in deciding organization structure." Explain. (b) "Dependency is increased when the resource you control is important, scarce and non-substitutable." Comment on the above statement in the light of the fact that the most important aspect of power is that it is a function of dependency. (c) Enumerate the different conditions needed for conflict to arise. How does the channel chosen for communication have an influence on stimulating conflict? (d) "Workers’ education is the latent energy in economic development." Explain the concept of workers’ education and highlight its aims and objectives. (e) What are the major collective bargaining issues in Indian industries? What do you foresee as a major issue of the future?

(a) How do mission, vision and values help in developing good plan for an organization? Explain planning premises. (b) Outline the organizational structure of a virtual organization. How does it differ from a boundaryless organization? Which type of industries is best suited to a virtual organizational setup? Explain with examples. (c) Differentiate between career, career planning, career development and career management. Who are the major stakeholders in career development?

(a) "A person can have thousands of attitudes but organizational behaviour focuses its attention on a very limited number of job-related attitudes." Explain the different job-related attitudes. How do they differ from other non-job-related attitudes? (b) "Does delegation of authority mean loss of power or enhancement of power?" Critically explain. (c) How does an organization determine the effectiveness of its recruitment process? To avoid the high cost involved in the recruitment process, what alternatives are used by organizations? Explain.

(a) Highlight the key differences between human resource information system, human resource analytics and enterprise resource planning, and give their suitable applications. Illustrate and explain a typical human resource information system framework. (b) How does a learning organization model integrate the strategies in the domains of individual, team and organizational learning? What are the desired behavioural changes for a learning organization as described by Senge? (c) "Economic development of India will depend on the inventions carried out by entrepreneurs." Explain.

(a) Discuss on the objectives and categories of decisions of the finance function in an organization. (b) Elaborate on the objective of 'Accounting Standards' and discuss on its significance in the emergence of International Financial Reporting Standards (IFRS) as Global Standards. (c) Comment on the salient features of the EASE Next Reforms. (d) "Marketing is everywhere. Good marketing is not a coincidence but a result of well thought strategy." Elaborate giving suitable example. (e) "Customer-centric companies are building customer relationships and not just products or services." Explain giving importance of customer satisfaction. Give examples also.

(a) Given below is the data of two firms in the same industry: [table provided] (i) Compute the Return on Equity (RoE) based on DuPont analysis. Which company would investors prefer? (ii) What are the limitations of DuPont analysis? (b) What are the factors that need to be kept in mind while designing the capital structure of a firm? (c) "Marketing channel decisions lead to developing value network." Explain the importance of intermediaries giving suitable examples.

(a) A Ltd's EBIT is ₹10,00,000. The company has 12%, ₹30 lakhs debentures. The equity capitalization rate (K_e) is 20%. Compute the following: (i) Market value of equity and value of firm (ii) Overall cost of capital (b) What are some early signs of cash flow problems? (c) (i) "Price is the most important element of marketing mix." Discuss. (ii) Elaborate the process to decide right time to change price of product. Do you think leadership pricing strategy is applicable in today's context? Give examples.

(a) During a month, 4500 units were introduced into process A. The normal loss was estimated at 8% on input. At the end of the month, 2600 units had been produced and transferred to next process, 1400 units were incomplete and 500 units had been scrapped. It was estimated that uncompleted units had reached a stage in production as follows: Material—80% completed; Labour—60% completed; Overheads—50% completed. The cost of 4500 units introduced was ₹10,500. Direct materials introduced during the process amounted to ₹2,400. Production overheads incurred were ₹3,490. Direct labour was ₹5,460. Units scrapped realised ₹3 each, and were 100% complete. Answer the following: (i) Prepare statement of equivalent production. (ii) Value abnormal loss, scrap and closing WIP. (iii) Prepare Process A account and Abnormal Loss account.

Examine the effectiveness of different Chambers of Commerce and Industry in India.