UNIVERSITY OF CALICUTBUS/COM 2C 06 MASTER OF COMMERCE

FINANCIAL MANAGEMENT

60 Hrs. 4 credits

Module I

Introducction to Financial Management-meaning, definition, scope, functions,objectives. Wealth maximization Vs profit maximization. Role of financial manager -Agency problem in financial management - organization of finaace function. Timevalue of money - compounding and discounting. An overview of capital investmentdecision (details are not necessaq/ as it has discussed in detail in ManagementAccounting Course at first semester)

Module II

Cost of capital: Cost of capital, meaning, significance, concept of opportunity cost incost of capital, determination of cost of debt, preference share and equity share-cost ofequity and CAPM. Weigbted average cost of capital.

Module III

Financial leverage and Capital structure decision: Definitioa of capital structure -meaning of financial leverage, measurement of financial leverage, financial leverage

and shareholders returns Operating leverage and combined leverage - Ttreories ofcapital structure, NI approach, NOI approach optimum capital structure, traditionaltheory - MM theory - over capitalization, undercapitalization and fair capitalization.

Module IV

Working capital management - factors determining working capital - es tttating

working capital, components of working capital, Inventory management - Receivable

management - Cash management - working capital linancing for lndian Industry -major co"'.''ittees on working capital frnancing.

Module V

Sources of long term finance- conventional and innovative sources-leasing- factoring,securitization-dividend theories, Water Model, Gordont model MM approach ofdividend -legal aspects of dividend Palrment -Corporate governance-Financial

engineering.

Coverage of questions:Soo/o theory problems

References:

1. James Van Home C: Financial Management and Poliry, Prentice hall2. I.M.Pandey: Financial Management, Sahithya Bhavan.3. Prasanna Chandra: Financial Management, TMH'4. V.K.Bhalla: Financial Management

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UNIVERSITY OF CALICUTBUS/COM. 2C 07 MASTER OF COMMERCE

MANAGEMENT SCIENCE

6O Hrs. 4 credits

Module I

Management Science: Scope and importance: Linear Programrning Applicationsadvantages and disadvantages - formulation of problem - assumptions - Graphic andsimplex methods - Duality and shadow pricing; sensitivity analysis -simple probiems.

Module IITransportation and Assignment Problem - Tralsportation model and its applicationsin business problems - without degeneracy. Assignment Model and its applications tosoiution of business problems.

Module III

Decision tJreory: framework; payoff tables; regret tables, Decision under certainty,uncertainty arrd risk; methods of incorporating risk; value of perfect information;Decision tree and its uses.

Module IV

Netv/ork Analysis: Construction of network diagramme - CPM and PERT - TimeAnalysis, Cost Analysis - Time cost trade oII - crashing.

Module V

Queuing Theory: Structure, assumptions, uses and characteristics, Single channelwith infinite population - multiple chalnel with infinite population - Simulation:concepts and applications. Monte Carlo Simulation - limitations of simulation -simulation through computer software.

Books:

1. Hillier, Frederick S and Hillier, Mark S: Introduction to Management Science,Tata McGraw Hill, New Delhi 2O04.

2. Mathur, K and Solow, D, Ma.nagement Science, Eaglewood Cliffs, New JerseyPrentice Hal1 Inc, 1994.

3. Theirout, R.J and Klekamp, R.C: Decision Making Through OperationsResearch, John Wiley, New York 1989.

4. Hillier, Frederick S and Liebermal, Gerald J: Introduction to OperationsResearch, Tata McGraw HilI, New Delhi 2003.

5. Narang A.S, Linear Programrning and Decision making, Sultan Chand, NewDelhi 1995.

6. Hamdy A, Taha, Operations Research, Pearson, 2012.