The following figures are collected from the annual report of XYZ Ltd.: Net Profit 30 lakhs Outstanding 12% preference shares No. of equity shares 100 lakhs 3 lakhs Return on Investment 20% Cost of Equity (Ke) 16% What should be the approximate dividend pay-out ratio so as to keep the share price at ? 42 by using Walter model?

Q: What is sensitivity analysis? Explain.

A: Financial models refer to the summary or brief of a company's performance, on the basis of the…

Q: Discuss the major characteristics of a theory.

A: Discussion of major characteristics of a theory

Q: Explain the term sensitivity analysis

A: Sensitivity Analysis is a tool used in financial modeling to study how independent variable values…

Q: Explain Matching Principles?

A: Matching concept is an accounting principle which explains the need to match revenue with the…

Q: 6) Explain Realisation concept and provide example.

A: Accounting concepts are those rules, regulations and guidelines which are used for the…

Q: How to choose a Benchmark?

A: Investors select a market index (or a mix of indices) as the portfolio's benchmark. An index…

Q: Explain materiality , happens and why these are important? Explain with the help of example.

A: Materiality refers to the concept of determining whether a particular item, transaction, or…

Q: Describe the benefits of benchmarking.

A: Benchmarking is a way to measure something in corporate environment, it is also used to promote…

Q: Describe sensitivity analysis? Give an example?

A: Sensitivity Analysis:The process to evaluate the effect of change in one variable on the end result…

Q: Realization Test Principle/Theory.

A: Accounting is based on some principles, and to maintain uniformity, everyone must follow accounting…

Q: Decision-usefulness approach focuses on the relevance of information being communicated.” Explain…

A: The decision-usefulness approach is a fundamental concept in financial accounting that emphasizes…

Q: Define the term predictive value.

A: Predictive value refers to the fact that quality financial information can be used to base…

Q: What are the ramifications of doing a CVP analysis

A: It   is about the ramifications of doing a CVP analysis:

Q: Describe the assumptions underlying CVP analysis?

A: Cost-Volume-Profit Analysis (CVP Analysis): CVP Analysis is a tool of cost accounting that measures…

Q: Explain the Sensitivity Analysis?

A: The sensitivity analysis is utilized to comprehend the impact of a lot of autonomous factors on some…

Q: Explain the purpose of the conceptual framework.

A:

Q: Discuss and explain the meaning of right offerings and their advantages.

A: Right issue refers to giving a right to existing shareholders to subscribe additional shares in…

Q: How do you explain or interpret predictive model information?

A: Meaning- Predictive Model As the name suggest, where with the help of historical figures or even…

Q: Explain the PSA prepayment model?

A: What Is a Prepayment Model? In lending, a prepayment model is used to estimate the level of…

Q: What is the actual formula used to get this answer?

A: Present value of annuity Annuity is a series of equal payments at equal interval over a specified…

Q: What are ESOPs? What are some of their advantages anddisadvantages?

A: ESOP: Employee stock ownership plan is retirement plans for employees of the company wherein the…

Q: Compare consulting and assurance services.

A: Consulting is classified as the practice of giving insight on a subject to a third party for a fee.…

Q: Discuss the concept of sensitivity analysis

A: Financial analysis is the process of analyzing and estimating the financial data and information…

Q: What is a sensitivity analysis, and how does it work? Can you provide an illustration of this?

A: Here is the Answer

Q: Explain subsequent events and why these are important? Explain with the help of example.

A: Subsequent events refer to events or transactions that occur after the balance sheet date but before…

Q: Explain what is meant by the term decision model.

A: Every business has to take important decisions now and then. A proper understanding of the situation…

Q: Contrast the advantages and disadvantages of CASE tools. What should determine whether CASE is used?

A: CASE Tools:   CASE stands for Computer Aided Software Engineering Tools. CASE is used for the…

Q: What is the objective of having a conceptual framework?

A: Conceptual framework means set of rules and guidelines that help the users and preparers in…

Q: What is counterbalancing?

A: Errors: The comparability and consistency of the financial statements decreases when a company…

Q: What is sensitive analysis?

A: Sensitive analysis is a method for predicting the outcome of a decision if a situation turns…

Q: sensitivity analysis

A: The sensitivity analysis represents the more reliable source of prediction. It helps the managers to…

Q: What is the meaning behind Recognition Criteria? How does it help determine when an event should be…

A: Accounting ideas, usually referred to as accounting assumptions or accounting principles, are the…

Q: Define the term confirmatory value.

A:

Q: Examine the key assumptions underlying the CAPM and the APT model?

A: Introduction  The CAPM and the APT model are two of the most popular models used in finance, but…

Q: Define the term understand ability.

A: The financial information refers to the data related to the monetary transactions of the business.…

Q: Explain Confirmatory value.

A: Definition:   Relevance concept: The concept of relevance explains that any information is useful…