Define Financial Management.

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Financial Management

Financial management is that specialized activity which is responsible for obtaining and affectively utilizing the funds for the efficient functioning of the business and, therefore, it includes financial planning, financial administration and financial control.

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Sanisha Maharjan

Sanisha Maharjan

Jan 16, 2022

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2. If there is an increase in accounts receivable what will happen to the cash flow?

3. Why would you need to calculate depreciation?

4. Can you tell us how assets and liabilities affect a company’s cash flow?

5. What do you understand by financial benchmarking?

6. Mention the differences between NPV and IRR if you think there are any.

7. Mention any financial reporting software you have used before.

8. Explain the syntax of 2 lookup functions.

9. How can negative working capital help a business?

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13. Why is the asset turnover ratio calculated?

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15. Should you increase the consumer base by 1% or price by 1%?

16. What are the advantages of raising debt over equity?

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18. What is EBITDA? What is left out of it?

19. What is important to consider when deciding on capital investment?

20. When do you capitalize rather than expense a purchase?

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28. What do you mean by ratio analysis?

29. What do you know about valuation techniques?

30. What is ‘goodwill’?

31. What is ‘capital structure’?

32. What is a ‘composite cost of capital’?

33. Define average rate of return.

34. What are the demerits of the payback period?

35. What are the merits of payback period method? Payback method has the following merits:

36. What is the relation between the pay back period and the quality of project?

37. Write the formula for determining payback period of a cash flow project.

38. Define terminal cash flows.

39. What do you understand by operational cash flows?

40. What are initial cash flows?

41. Describe net capital investment as a component of investment analysis

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43. What is post completion audit in the process of capital budgeting?

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45. Why are the capital investments important? Capital investments are important for three reasons:

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47. What points should be taken into consideration in order to calculate the cost of capital?

48. Describe the correct capital structure of a firm for obtaining the weights to work out the weighted average.

49. How many approaches are there for estimating cost of equity? There are four different approaches for estimating cost of equity:

50. What does the cost of equity capital indicate?

51. What is the importance of cost of equity capital?

52. Illustrate the method of computing cost of preference shares with the help of an example.

53. Write an important condition for the adjustment of the cost of debt.

54. What is cost of debt capital?

55. Illustrate the concept of average cost of capital with the help of an example?

56. Describe some aspects of cost of capital. A few aspects of cost of capital have been mentioned below:

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58. What do you understand by the cost of capital?

59. A company had the following balance

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64. Cash flow from operating Activities + Cash flow from Investing Activities + Cash flow from Financing

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70. How will you classify loans given by HDFC while preparing cash flow statement.

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73. Why is the cash flow statement not a suitable judge of profitability ?

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78. What is ‘cost accountancy’?

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90. Explain briefly five factors determining the amount of fixed capital.

91. What are the determinant of capital structure of a company? OR ‘Determination of capital structure of a company is influenced by a number of factors’ explain six such factors.

92. What is Financial risk? How does it arise?

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100. Are the share holders of a company likely to gain with a debt component in the capital employed ? Explain with the help of an example?

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102. What do you mean by floatation cost?

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111. State the primary objective of Financial management.

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