FPSBI/M-VI/06-01/09/WN-14

Solutions - Rahul
C)
1)
Present age of Aditi = 43 years
Age of Aditi when Rahul Retires = 57 years
Life expectancy of Aditi = 77 years
Annuity needed = 77-57 = 20 years
2)

Current Market Value of House

8000000
Insurance Cover
6000000
Since Insurance Cover is less than the house value, Average Clause shall become applicable
Claim Amount
1162500 (6000000/8000000)*1550000
Less Deductible
100000

B)

Net Claim Amount

3)

1062500 1162500-100000

C)
Inflation Adjusted Rate of Return
Annual Amount Invested

5.66% ((1.12/1.06)-1)
35000
Current Cost

Age Ajay
16
17
18
19
20
21
22
23

Age Preeti
12
13
14
15
16
17
18
19
20
21
22
23

MF
687910 Years

FV(12%,10, -35000, 0,1)

PV of sums required at the investment rate today

168,954 297754/(1.12)^(5-0)
179,666 354630/(1.12)^(6-0)
151,336 334556/(1.12)^(7-0)
152,311 422370/(1.12)^(9-0)
144,151 447712/(1.12)^(10-0)
136,429 474575/(1.12)^(11-0)
297,754 250000*(1.06)^(3-0)
354,630 250000*(1.06)^(6-0)
334,556 250000*(1.06)^(5-0)

0
1
2
3
4
5
6
7
8
9
10
11

422,370 250000*(1.06)^(9-0)
447,712 250000*(1.06)^(10-0)
474,575 250000*(1.06)^(11-0)
932,847
Monthly investments required to accumulate
the balance amount at PV
244,937 932847-687910
No. of months
Rate pa
rate effective pm
Monthly investment

4)

60
12%
0.9489% (1+0.12)^(1/12)-1
5322
PMT(0.9489%,60,-244937,0,1)

B)
Aditi Age
Life Expectancy
Tenure for which fund will be required
Monthly Expenses
His Personal Expenses
Her Monthly Contribution

43
77
34 77-43
70000
15000
15000

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

Net Monthly Expenses required on death of Rahul

Rate of Inflation
Risk Free Rate of Return

40000 70000-15000-15000
5%
6%

Real Rate of Return

0.9524% ((1.06/1.05)-1)*100

PV of monthly expenses required for the expected life of Aditi

Existing cover
Hence, additional cover required
5)

6)

13956865 PV((1+0.9524%)^(1/12)-1,34*12,-40000,0,1)
4000000
9956865 13956865-4000000

B)
Tax evaded Rs. 45,000, minimum penalty Rs. 45,000 and maximum penalty Rs. 1,35,000

45000 150000*30%
135000 45000*3

a)

A)
Consideration price of the Shares of X Ltd.
Cost of Shares of X Ltd.
Indexed cost of acquisition
after taking cost of inflation index
Capital Gain
Long Term Capital Gain Tax

b)

without taking cost of inflation index

Tax payable

1500000
150000

Total Long Term Capital Gain Tax Payable will be lower of a) or b)

150000

7)

A)
VRS Received

Date
1-Jun-2009
1-Apr-2010
1-Apr-2011
1-Apr-2012
1-Apr-2013
1-Apr-2014
1-Apr-2015
10)

849754
169951

(3000000-2150246)
849754*20%

3000000-1500000
1500000*0.1

500,000

Therefore the amount of VRS taxable

Tax @ 33.99%
Hence, amount received net of tax
A)
Quaterly Contribution

150000*582/406

2,000,000

Exempt amount under Sec 10(10C) of IT Act

8)

3000000
1500000
2150246

1,500,000 2000000-500000
509,850 1500000*0.3399
1,490,150 500000+(1500000-509850)

6000
Outstanding Contribution during
the year
Balance
450000
504760
570381
641251
717791
800455
889731

18000
24000
24000
24000
24000
24000

Interest

Closing Balance end of

FY

36760
41621
46870
52540
58663
65276

504760
570381
641251
717791
800455
889731

Calculation of Interest
((450000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08
((504760+6000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08
((570381+6000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08
((641251+6000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08
((717791+6000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08
((800455+6000)+(6000*9/12)+(6000*6/12)+(6000*4/12))*0.08

B)

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

11)

B)
Face Value of MF
Units
Repurchase rate

10
9.04

23rd Oct, 2005

Initial Investment

100,000.00 10*10000
Fresh units

Opening Balance of units

Dividend - 24th Oct., 2006
Dividend - 8th May, 2007
Dividend - 23rd December,2007

16,500 Reinvested at
20,837 Reinvested at
26,672 Reinvested at

Closing balance
10,000.000
1,575.931
11,575.931 10000+1575.931
1,759.854
13,335.786 11575.931+1759.854
2,364.501
15,700.287 13335.786+2364.501

10.47
11.84
11.28

141,930.59 15700.287*9.04

Value of units on 23rd March, 2009 at NAV of Rs. 9.04 per unit
Time elapsed for investment

3 years and 5 months

3.416666667 years

3+(5/12)

10.79% (141930.59/100000)^(1/3.4167)-1

CAGR
OR
23-Oct-2005
23-Mar-2009

-100000
141931
10.79%

XIRR=
12)

B)
Taxability of Gold ETF
Consideration price of Gold ETFs sold
Cost of Gold ETFs
Indexed cost of acquisition
2006-07 & 2008-09
Capital Gain
Long Term Capital Gain Tax with indexation benefit
(1)
Long Term Capital Gain Tax without indexation benefit
(2)
Therefore, LTCG payable
(Lower of 1 and 2)

13)

C)

14)

A)
Present Age
Retirement Age
Life Expectancy
amount at first
month after
retirement

792635
491500
551162
241473
49743
31017
31017

46
60
80

110000
13%
Shares
Inflation
5% p.a.
0.4074% p.m.
Debt MF Returns
8% p.a.
0.6434% p.m.
Equity MF Returns
12% p.a.
0.9489% p.m.
Inf Adj Debt Returns
0.2350% p.m.
Corpus required
Value of 60% of existing equity shares portfolio
FV of 60% of Shares portfolio on retirement
By Saving Rs.
150000 every year in equity mutual fund scheme ,
The value of units in the scheme at retirement would be
Total retirement corpus
Deficit in required corpus
15)

500*1585.27
500*983
491500*582/519
792635-551162
241473*20.6%
(792635-491500)*10.3%

(1+0.05)^(1/12)-1
(1+0.08)^(1/12)-1
(1+0.12)^(1/12)-1
(1+0.006434)/(1+0.004074)-1
20206829 PV(0.235%,(80-60)*12,-110000,0,1)
2379000 3965000*0.6
13167176 FV(13%,60-46,0,-2379000,0)
5441957 FV(12%,(60-46),-150000,0,1)
18609134 5441957+13167176
(1597696) 18609134-20206829

A)

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

Solutions - Prabhat
16)

D)
EMI
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48

30-Apr-02
31-May-02
30-Jun-02
31-Jul-02
31-Aug-02
30-Sep-02
31-Oct-02
30-Nov-02
31-Dec-02
31-Jan-03
28-Feb-03
31-Mar-03
30-Apr-03
31-May-03
30-Jun-03
31-Jul-03
31-Aug-03
30-Sep-03
31-Oct-03
30-Nov-03
31-Dec-03
31-Jan-04
29-Feb-04
31-Mar-04
30-Apr-04
31-May-04
30-Jun-04
31-Jul-04
31-Aug-04
30-Sep-04
31-Oct-04
30-Nov-04
31-Dec-04
31-Jan-05
28-Feb-05
31-Mar-05
30-Apr-05
31-May-05
30-Jun-05
31-Jul-05
31-Aug-05
30-Sep-05
31-Oct-05
30-Nov-05
31-Dec-05
31-Jan-06
28-Feb-06
31-Mar-06

3000000
2994674
2989289
2983845
2978340
2972775
2967148
2961459
2955708
2949893
2944013
2938069
2932059
2925983
2919839
2913628
2907348
2900999
2894580
2888090
2881528
2874894
2868186
2861405
2854548
2847616
2840607
2833521
2826357
2819113
2811790
2804385
2796899
2789331
2781678
2773942
2766119
2758211
2750215
2742131
2733957
2725693
2717338
2708891
2700351
2691716
2682986
2674159

Interest
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09

rate
33126 3000000*1.1042%
33067 2994673*1.1042%
33008
32948
32887
32825
32763
32700
32637
32573
32508
32442
32376
32309
32241
32172
32103
32033
31962
31890
31818
31745
31671
31596
31520
31443
31366
31288
31209
31129
31048
30966
30883
30800
30715
30630
30543
30456
30368
30279
30188
30097
30005
29912
29817
29722
29626
29528

EMI

FPSB India/Public

1.1042% (13.25/12)%
38452
PMT(1.1042%,180,-3000000,0,0)

FPSBI/M-VI/06-01/09/WN-14

49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101

30-Apr-06
31-May-06
30-Jun-06
31-Jul-06
31-Aug-06
30-Sep-06
31-Oct-06
30-Nov-06
31-Dec-06
31-Jan-07
28-Feb-07
31-Mar-07
30-Apr-07
31-May-07
30-Jun-07
31-Jul-07
31-Aug-07
30-Sep-07
31-Oct-07
30-Nov-07
31-Dec-07
31-Jan-08
29-Feb-08
31-Mar-08
30-Apr-08
31-May-08
30-Jun-08
31-Jul-08
31-Aug-08
30-Sep-08
31-Oct-08
30-Nov-08
31-Dec-08
31-Jan-09
28-Feb-09
31-Mar-09
30-Apr-09
31-May-09
30-Jun-09
31-Jul-09
31-Aug-09
30-Sep-09
31-Oct-09
30-Nov-09
31-Dec-09
31-Jan-10
28-Feb-10
31-Mar-10
30-Apr-10
31-May-10
30-Jun-10
31-Jul-10
31-Aug-10

2665235
2656213
2647090
2637867
2628543
2619115
2609583
2599946
2590203
2580352
2570392
2560322
2550141
2539847
2529440
2518918
2508280
2497524
2486650
2475655
2464540
2453301
2441938
2430450
2418835
2407092
2395219
2383215
2371078
2358807
2346401
2333858
2321176
2308355
2295391
2282285
2269034
2255637
2242091
2228396
2214550
2200551
2186398
2172088
2157620
2142992
2128203
2113250
2098133
2082848
2067395
2051771
2035975

38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09

29430
29330
29229
29127
29024
28920
28815
28709
28601
28492
28382
28271
28159
28045
27930
27814
27696
27578
27458
27336
27213
27089
26964
26837
26709
26579
26448
26315
26181
26046
25909
25770
25630
25489
25346
25201
25055
24907
24757
24606
24453
24298
24142
23984
23824
23663
23500
23335
23168
22999
22828
22656
22481

311624

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154

30-Sep-10
31-Oct-10
30-Nov-10
31-Dec-10
31-Jan-11
28-Feb-11
31-Mar-11
30-Apr-11
31-May-11
30-Jun-11
31-Jul-11
31-Aug-11
30-Sep-11
31-Oct-11
30-Nov-11
31-Dec-11
31-Jan-12
29-Feb-12
31-Mar-12
30-Apr-12
31-May-12
30-Jun-12
31-Jul-12
31-Aug-12
30-Sep-12
31-Oct-12
30-Nov-12
31-Dec-12
31-Jan-13
28-Feb-13
31-Mar-13
30-Apr-13
31-May-13
30-Jun-13
31-Jul-13
31-Aug-13
30-Sep-13
31-Oct-13
30-Nov-13
31-Dec-13
31-Jan-14
28-Feb-14
31-Mar-14
30-Apr-14
31-May-14
30-Jun-14
31-Jul-14
31-Aug-14
30-Sep-14
31-Oct-14
30-Nov-14
31-Dec-14
31-Jan-15

2020004
2003857
1987531
1971025
1954337
1937465
1920406
1903160
1885722
1868092
1850268
1832246
1814026
1795604
1776979
1758148
1739110
1719861
1700400
1680723
1660830
1640716
1620381
1599821
1579034
1558018
1536770
1515287
1493566
1471606
1449404
1426956
1404260
1381314
1358114
1334658
1310944
1286967
1262726
1238217
1213437
1188384
1163054
1137444
1111551
1085373
1058906
1032146
1005091
977737
950081
922120
893850

38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09
38452.09

22305
22127
21946
21764
21580
21393
21205
21015
20822
20627
20431
20232
20030
19827
19621
19413
19203
18991
18776
18559
18339
18117
17892
17665
17436
17204
16969
16732
16492
16249
16004
15756
15506
15252
14996
14737
14475
14211
13943
13672
13399
13122
12842
12560
12274
11985
11692
11397
11098
10796
10491
10182
9870

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
176
177
178
179
180

28-Feb-15
865268
38452.09
31-Mar-15
836370
38452.09
30-Apr-15
807153
38452.09
31-May-15
777613
38452.09
30-Jun-15
747748
38452.09
31-Jul-15
717552
38452.09
31-Aug-15
687023
38452.09
30-Sep-15
656157
38452.09
31-Oct-15
624951
38452.09
30-Nov-15
593399
38452.09
31-Dec-15
561499
38452.09
31-Jan-16
529247
38452.09
29-Feb-16
496639
38452.09
31-Mar-16
463671
38452.09
30-Apr-16
430339
38452.09
31-May-16
396639
38452.09
30-Jun-16
362566
38452.09
31-Jul-16
328118
38452.09
31-Aug-16
293289
38452.09
30-Sep-16
258075
38452.09
31-Oct-16
222472
38452.09
30-Nov-16
186477
38452.09
31-Dec-16
150084
38452.09
31-Jan-17
113289
38452.09
28-Feb-17
76088
38452.09
31-Mar-17
38476
38452.09
Gross Annual value is actual rent received
Less : Municipal taxes paid
Net annual Value
Less : 30% Statutory deduction
187000*0.3
Less: Interest on Loan
Loss from House property
Prabhat's share of loss

9554
9235
8913
8586
8257
7923
7586
7245
6901
6552
6200
5844
5484
5120
4752
4380
4003
3623
3238
2850
2457
2059
1657
1251
840
425
192000
5000
187000
56100
311600

367700 56100+311600
180700 367700-187000
90350 180700*0.5

# in case Municipal value is higher then Rent then Standerd Rent will be taken as gross annual value but if actual rent received is higher than standard
rent then actual rent received is taken as gross annual value.
17)

B)
EMI paid in FY 2008-09
Less : Interest part for FY 2008-09
Principal repayment
50% share of Prabhat

18)

A)

19)

A)
Present Age of prabhat
Age at retirement
Expected Age at Death
Present household/monthly living expenses
Expected exp. On first month of retirement

461424 38452*12
311624
149800 461424-311624
74900 149800/2

45
60
80
40000 pm
FV(0.06,15,0,-40000,0)*0.75

71897

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

Expected return from pension fund

Inflation
Inlation adjusted return
inlation adjusted monthly return
Corpus require at the time of retirement
20)

B)
outstanding balance as on 1 apr 2009
Less Prepayment
Balance outstanding
new tenure of loan
Rate of interest
PMT
Share of prabhat
1
1-Apr-09
2
1-May-09
3
1-Jun-09
4
1-Jul-09
5
1-Aug-09
6
1-Sep-09
7
1-Oct-09
8
1-Nov-09
9
1-Dec-09
10
1-Jan-10
11
1-Feb-10
12
1-Mar-10
13
1-Apr-10
14
1-May-10
15
1-Jun-10
16
1-Jul-10
17
1-Aug-10
18
1-Sep-10
19
1-Oct-10
20
1-Nov-10
21
1-Dec-10
22
1-Jan-11
23
1-Feb-11
24
1-Mar-11
25
1-Apr-11
26
1-May-11
27
1-Jun-11
28
1-Jul-11
29
1-Aug-11
30
1-Sep-11
31
1-Oct-11
32
1-Nov-11
33
1-Dec-11
34
1-Jan-12
35
1-Feb-12
36
1-Mar-12
37
1-Apr-12
38
1-May-12
39
1-Jun-12

10% p.a.
6% p.a.

0.7974% per month

0.4868% per month
0.3092% per month
12,206,991 PV(0.3092%,12*(80-60),-71897,0,1)
.
2268908
1000000
1268908 2268908-1000000

5 years

1268908
1253885
1238696
1223338
1207809
1192108
1176233
1160181
1143951
1127541
1110949
1094173
1077210
1060059
1042717
1025183
1007455
989530
971406
953080
934552
915818
896875
877723
858359
838779
818982
798966
778728
758265
737575
716656
695505
674119
652497
630634
608529
586179
563581

29034
29034
29035
29036
29037
29038
29039
29040
29041
29042
29043
29044
29045
29046
29047
29048
29049
29050
29051
29052
29053
29054
29055
29056
29057
29058
29059
29060
29061
29062
29063
29064
29065
29066
29067
29068
29069
29070
29071

13.25%
29034
14517
14011
13845
13677
13508
13336
13163
12988
12810
12631
12450
12267
12081
11894
11705
11513
11320
11124
10926
10726
10524
10319
10112
9903
9692
9478
9262
9043
8822
8598
8373
8144
7913
7680
7443
7205
6963
6719
6472
6223

PMT(13.25%/12,60,-1268908,0,0)
29034*0.5
1268908*(13.25/12)%
1253885*(13.25/12)%

1.1042%

14517 29034*0.5

FPSB India/Public

FPSBI/M-VI/06-01/09/WN-14

40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
21)

1-Jul-12
1-Aug-12
1-Sep-12
1-Oct-12
1-Nov-12
1-Dec-12
1-Jan-13
1-Feb-13
1-Mar-13
1-Apr-13
1-May-13
1-Jun-13
1-Jul-13
1-Aug-13
1-Sep-13
1-Oct-13
1-Nov-13
1-Dec-13
1-Jan-14
1-Feb-14
1-Mar-14

A)
Sale Consideration
Less : Expense on transfer
Less : Indexed Cost of Acquistion
LTCG=

22)

D)

23)

A)
Gross return obtained
After Tax return
Inflation
Inflation adjusted post tax return

540733
517631
494273
470657
446778
422635
398225
373544
348589
323358
297847
272053
245974
219606
192946
165990
138735
111179
83317
55147
26665

29072
29073
29074
29075
29076
29077
29078
29079
29080
29081
29082
29083
29084
29085
29086
29087
29088
29089
29090
29091
29092

5971
5716
5458
5197
4933
4667
4397
4125
3849
3570
3289
3004
2716
2425
2130
1833
1532
1228
920
609
294

2500000
100000
1121387 1000000*(582/519)
1278613 2500000-(100000+1121387)

11% p.a.
7.7% p.a.
6% p.a.
1.60%

11%*(1-0.3)
(1+7.7%)/(1+6%)-1

24)

B)

25)

A)
Annual expenses for higher education at the end of one year
These expenses discounted at the investment rate of 15% today

350,000

Annual expenses for higher education at the end of 2nd year

These expenses discounted at the investment rate of 15% today

378,000
350000*1.08

Annual expenses for higher education at the end of 3rd year

These expenses discounted at the investment rate of 15% today

408,240
350000*1.08^2

Annual expenses for higher education at the end of 4th year

These expenses discounted at the investment rate of 15% today

440,899
350000*1.08^3

Annual expenses for higher education at the end of 5th year

These expenses discounted at the investment rate of 15% today

476,171
350000*1.08^4

304,348 350000/1.15

285,822
378000/1.15^2
268,424
408240/1.15^3
252,086
440899/1.15^4

FPSB India/Public

236,741

FPSBI/M-VI/06-01/09/WN-14

476171/1.15^5
Total expenses adjusted for inflation and discounted at the investment rate,
i.e PV of sum required

1,347,421
304348+285822+268424+252086+236741

Rate of investment
15% pa
(1+15%)^(1/12)-1
Rate of investment
1.1715% pm
Therefore, the amount of SIP monthly to achieve this PV starting today for 5 years
26)

B)
Sum Assured
Add Bonus

31,029 PMT(D322,60,-H318,0,1)

500000
300000 60*500*10
150000 50*500*6

Total Claim
27)

B)
Target amt
Tenure
Installments
PMT
Rate

950000 500000+300000+150000

1338225.58
5 years
60

7.50%
1.88%
7.71%
0.6211%
18360

pa
quarterly
(1+1.88%)^4-1
(1+7.71%)^(1/12)-1
p.m.
PMT(0.6211%,60,0,-1338225.58,1)

FPSB India/Public

10