A company that produces and markets continuing education programs on DVDs for the educational testing industry has traditionally mailed advertising to prospective customers .A market research study was undertaken to compare two approaches: mailing a sample DVD upon request that contain highlights of the full DVD and sending an email containing a link for a website from which sample material could be downloaded. Of those who responded to either the mailing or the e-mail, the results were as follows in terms of purchase of the complete DVD .

                                    Type of media used

             Purchased                mailing                  E-mail                     total

                   Yes                            26                             11                                 37

                   No                             227                          247                               474

                   Total                         253                          258                               511

a)     at the 0.5 level significance, is there evidence of a difference in the proportion of DVDs purchased in the proportion of DVDs   purchased on the basis of the media used ?

b)     on the basis of the results of (a) which type of media should the company use in the future ? explain the rationale for your decision

The company also wanted to determine which of three sales approaches should be used to generate sales among those who either requested the sample DVD by mail or downloaded the sample DVD but did not purchase the full DVD : 1) targeted e-mail , 2) A DVD that contain additional features or 3) a telephone call to prospective customers. The 474 respondents who did not initially purchase the full DVD were randomly assigned to one of the three sales approaches. The results in terms of purchases of the full program DVD, are as follows:

                                                                                 Sales approach

ACTION                     Targeted            More complete          Telephone calls     Total

                                     Email                       DVD

Purchase                          5                       17                                     18                       40

Do not purchase            153                   141                                   140                      434

Total                                158                    158                                   158 474

c)      at the 0.05 level of significance, is there evidence of a difference in the proportion of DVDs purchased on the basis of the sales strategy used?

d)     On the basis of the results of (c) which sales approach do you think the company should use in the future . Explain the rationale for your decision.

Ahmed and Mohammed want to start their own business. They are thinking to establish a factory to manufacture
sunglass in Oman. The factory needs an investment of OMR 600,000. Mohamed having OMR 150,000 and
Ahmed having OMR 250,000. They have a shortage of OMR 200,000. Ahmed suggests to take loan from Bank
but Mohammed suggests to sell shares to manage the investment shortage. They are confusing regarding the suitable source of finance to manage the investment shortage. This will affect the legal entity of their
organization. There are many forms of organization, but they are confusing between LLC and SAOG.

Furthermore, Ahmed suggest to hire the following employees:
 The Managing Director has the major responsibility for running of the company, including setting
company targets and keeping an eye on all departments.  The Distribution Manager is responsible for controlling the movement of goods in and out of the
warehouse, supervising drivers and overseeing the transport of goods to and from the firm.  The Production Manager is responsible for keeping a continuous supply of work flowing to all production
staff and also for organizing manpower to meet the customers' orders.  The Sales Manager is responsible for making contact with customers and obtaining orders from those
contacts.  The Finance Manager controls all the financial dealings of the company and is responsible for producing
management accounts and financial reports.  The Public Relation Manager is responsible for external communications, media, social media and
complains  The Human Resource Manager is responsible to handle all staff affairs, HRP, recruitment and selection,
etc.  The IT Manager is responsible for maintain the organization ERP and any technology within the
organization  Maintenance manager is responsible to maintain the production line and company assets.   
Also, they are planning to hire 5 distribution officers, 5 accountants, 5 HR officers, 3 Public relation officers, 10 Trade promotors, 5 Mechanical Engineering for production, 5 Mechanical Engineering for maintenance 100 production labours and 10 Labour supervisors.

Explain the main functional areas of a business organization that you have identified from the case study? Support your answer by identifying the responsible manager of each functions

Journalize the following entries :

1. It was determined that a shipment on Dec 30 from Brodie to Dawson Corp was not recorded. Dawson purchased from Brodie 100,000 lbs of biscuits for sales price of $4.00 per LB. Cost of this product was $1.50 per LB. Terms were FOB Shipping Point. Payment terms Net 30. The Company also billed the required 7% sales tax which was added to the receivable from Dawson.

2. Per review of Brodie's AR Aging by the finance team using the Aging of Receivables Method, it was determined that 10% of the ending Accounts Receivable Balance of $4,500,000 need to be reserved for in the Allowance for Doubtful Accounts (i.e. the ending balance). Record the adjustment keeping in mind the Allowance for Doubtful Accounts has a $120,000 balance before this adjustment

3.  Brodie needs to record Warranty Expense for 2018. It offers an up to 2 year freshness and taste warranty, and expects that 3% of the ending net Revenue of $16,000,000 for 2018 will ultimately have warranty claims to be resolved for customers

4. On Jul 1, Brodie issued $4,000,000 of 6% Bonds Payable at 95, with semi-annual interest due next on Jan 1. Bonds have two year maturity and mature on Jul 1, 2020. Accrue the Interest Expense and related liability as of Dec 31, 2018 for the interest due on Jan 1, 2019

5. The Bond Issuance on Jul 1, 2018, had a discount that needs to be amortized over its two year term as additional interest expense. Use the straight-line method to amortize the Bond Discount (thus increasing the Bonds Payable carrying value)

6.The Company needs to accrue its final Payroll of the year Dec 16-31, 2018, which will be paid on Jan 5, 2019. Total Salary and Wage accrual for the period is $200,000, and the payroll tax accrual for Company payroll tax expense is an extra 9% of the $200,000. Record in the separate accounts

7.Based upon the banner year's financial results for 2018, Management asked the Board of Directors for a bonus pool to pay its management & employees of $350,000. After discussion, the Board approved an even bigger bonus pool of $400,000, allowing management discretion in the allocation among the differing employees. Record this accrual

8.A physical inventory of the equipment performed on the last day of the year uncovered that a 10 year old piece of equipment was disposed of earlier in the year and dropped off at the dump. The Equipment has a cost of $60,000, and it was fully depreciated. Remove this asset and its related Accumulated Depreciation from the books

You are an Investor who focuses on IT companies with large future potential in further automation of Global Supply Chain. Last year you bought 5,000 shares in Lama Inc. a company well established in the tech domain. The following data are presented by Lama for calendar 2019

Net income                                                                                                                  $4,500,000

Common shares outstanding,                                                                            1,000,000 shares

10%, cumulative preferred shares, convertible into 120,000 common shares          $1,600,000

8% convertible bonds; convertible into 105,000 common shares                             $7,500,000

360,000 call options exercisable at $25 per share

Additional information

1.    The common and preferred shares and the convertible bonds were outstanding from the beginning of the year.

2.    In 2019, a $500,000 dividend was declared and paid; however, no dividends were declared in 2016.

3.    The average market price of the common shares in 2017 was $30. The stock price was $27 on January 1, 2017, and $35 on December 31, 2017.

4.    The convertible bonds were sold at par – no discount or premium .

5.    The income tax rate for 2017 is 30%.

Instructions

a)    Calculate basic EPS. – 3 Marks

b)    Calculate diluted EPS. - 9 Marks

c)    What is the importance of reporting diluted EPS? – 3 Marks

You are an Investor who focuses on IT companies with large future potential in further automation of Global Supply Chain. Last year you bought 5,000 shares in Lama Inc. a company well established in the tech domain. The following data are presented by Lama for calendar 2019

Net income                                                                                                                  $4,500,000

Common shares outstanding,                                                                            1,000,000 shares

10%, cumulative preferred shares, convertible into 120,000 common shares          $1,600,000

8% convertible bonds; convertible into 105,000 common shares                             $7,500,000

360,000 call options exercisable at $25 per share

Additional information

1.    The common and preferred shares and the convertible bonds were outstanding from the beginning of the year.

2.    In 2019, a $500,000 dividend was declared and paid; however, no dividends were declared in 2016.

3.    The average market price of the common shares in 2017 was $30. The stock price was $27 on January 1, 2017, and $35 on December 31, 2017.

4.    The convertible bonds were sold at par – no discount or premium .

5.    The income tax rate for 2017 is 30%.

Instructions

a)    Calculate basic EPS. – 3 Marks

b)    Calculate diluted EPS. - 9 Marks

c)    What is the importance of reporting diluted EPS? – 3 Marks

A. Your branch has just started the day’s business and many customers are thronging to get banking services. Suddenly the computer system breaks down and the customers and staff are complaining as this problem happens frequently. What should you do?
B. Encik Bahari is a long standing customer of your branch. He applied for a housing loan recently and your head office approved the loan at an interest rate of BLR
+ 2%. Encik Bahari requests for your goodwill as the branch manager to reduce the interest rate to BLR + 1%. You are unable to do it as it is against the rules of the Institute of Banks in Malaysia and Bank Negara Malaysia. How will you explain to Encik Bahari?

A. SBE Private Limited company is applying for a working capital loan. This is the company’s first application for credit facility from your bank. SBE Private Limited company is a medium-sized company that manufactures various types of antique furniture for local as well as international markets. The company is currently facing cash flow problem due to ineffective cost control.

B. XYZ Private Limited company is applying for an additional overdraft facility from your bank. This company has a good track record with your bank. However, the company has been experiencing difficulty lately due to industry-wide recession. According to the finance manager of XYZ Private Limited company, the purpose of the additional facility is to finance the company’s overhead cost.

Part 2
TASK
Obtain the balance sheets of two Commercial banks in Malaysia from their annual reports.
Calculate the following ratios, based on the available information:
1. Capital to total deposits ratio
2. Capital to total assets ratio
3. Capital to risk weighted assets ratio
4. Capital to loans ratio
Based on the ratios, which bank has better capital adequacy? Which bank has better capital
adequacy if you also incorporate qualitative measurement into the assessment?
Various aspects that can be used as qualitative measurement are as follows:
(a) Quality of bank’s management
(b) Quality of bank’s assets
(c) Bank’s earnings history
(d) Quality of bank ownership
(e) Accommodation cost
(f) Quality of operation procedures
(g) Volatility of deposits
(h) Local market conditions

Course Name : MBA FINANCE & BANKING

Question) According to the semi-strong form of the efficient markets hypothesis, ____.

Multiple Choice Answers) Please answer and explain!

a) stock prices do not rapidly adjust to new information.

b) corporate insiders should have no better investment performance than other investors even if allowed to trade freely.

c) future changes in stock prices cannot be predicted from any information that is publicly available.

d) arbitrage between futures and cash markets should not produce extraordinary profits.

There are a number of studies which show that women engage in more private religious rituals and daily prayer than men, who tend to engage in more public religious rituals. A researcher would like to discover if there is a relationship between gender and religious type, that is extrinsically religious (publicly religious), intrinsically religious (personally religious) or nonreligious. Perform the appropriate test (α = 0.05)

A local hospital claims that you will not wait longer than 45 minutes in the emergency room. You go out to test this claim and find a sample of 81 patients chosen at random from their emergency room, you find a sample mean of 52 minutes with a sample standard deviation of 23 minutes. Can you publicly debunk their claim (call their claim fraudulent) at the 1% significance level? Use a test stat and then a p-value to determine if your conclusion is weak or strong.