Read the instructions in your course documents, in your student portal, Course Outline, CA outline  and  your  portal  carefully.  You  will  be  penalized  with  marks  deduction  if  the instructions are not strictly followed.

Students  are  to  upload  their  assignment  by  the  due  date  through  their  student  portal account.  After the due date, students’ submissions will not be entertained.

Students should keep a copy of assignment submitted. The submitted report must show evidence that this is students’ own work.

Write your FULL Name AND your IC/Passport number as in the register on the answer script.

Please be reminded that plagiarism and collusion are serious offences, and all cases will be referred to the administration. Grades will be withheld until investigations are completed if the submission is suspected of plagiarism or collusion.

Deadline: 21 Oct 2022, 11.59am

Penalty Marks for Late Submission of Assignment

Within 24 hours: 20% to be deducted from total marks

More than 24 hours: submission will be graded zero

CA Submission

CAs must be submitted online via student portal.  Please read through instructions in  your student  portal and  CA  outline carefully  before submitting.

If you  have  further  queries,  please  read  the  FAQ.  If,  after  reading  the  FAQ,  you  need assistance     on     submission,     please     contact     the     team     directly     via     email     to itsd_simge@sim.edu.sg or call 6248 9393 Option 4.

For non-submission issues please email [email protected]. Please email with your student portal accounts. Email from other addresses will not be entertained. If issues raised are covered,  you  will  be  directed  to  read  through  instructions  in  the  CA  outline  and  FAQ. Please take time to read thoroughly before raising issues.

Question 1

Capital budgeting and capital raising are two major duties of the financial manager within the firm. Explain the differences between these duties for the financial manager. (4 marks)

Question 2

For  a  firm,  agency  problem  arises  for  the  separation  of  management  and  ownership. Identify and explain THREE methods to minimise agency costs. (6 marks)

Question 3

Explain the difference(s) between time series and cross-sectional analysis. Discuss which ratio  analysis  would  you  apply  to  determine  compare  a  firm’s  performance  with  the industry over time. (6 marks)

Question 4

Discuss TWO limitations of financial ratio analysis. You are to provide examples in your answer. (4 marks)

Question 5

AIRFLOW Tech Ltd is considering an investment with an amount of $2 million (comprising $1 million equity and $1 million debt) with a weighted average cost of capital of 10%. The investment is expected to generate a NOPAT of $300,000. The company’s tax rate is 20%.

(i)         Calculate the Economic value added (EVA) for the investment? (3 marks)

(ii)       Should the firm accept or reject the investment? Explain your reason(s).  (2 marks)

Question 6

JSS Ltd has forecasted its total funds requirements for the coming year as shown in the table below:

Given that short-term funds  cost  5% annually and that long-term funds  cost 8% annually, calculate the total cost of each of the following strategies:

(i)        An aggressive funding strategy. (4 marks)

(ii)       A conservative funding strategy. (2 marks)

(iii)      Discuss TWO types of risk a firm may face in the use of aggressive funding

strategy. (2 marks)