OCM 1 Marks Each

Fixed capital includes land of business, plant, machinery, vehicles, furniture etc.

Foreign investment institutions has to get registered before ‘SEBI’.

Issuing of debenture id comparatively less costly.

As per company act, equity shares are must be issued by a company producing capital fund by issuing securities.

Cash or cheque on paid-up capital of share.

Capital structure is consisted of various securities issued by the company such as equity share, preference share, debenture etc.

The objective of current value of net wealth of financial management.

Financial management adopt two concepts to achieve owner’s maximum economic welfare

• Maximization of profit.
• Maximization of wealth.

Working capital is invested in current assets and it is circulating in business so its form is changing so depreciation is not calculated.

Financial management is related to the decisions like investment, capital structure, dividend policy etc.

Financial market includes capital market and money market.

Capital market is a market of short term security such as Treasury bill, Commercial Paper etc.

Capital market includes primary market and secondary market.

Primary market is a market of new securities issued by a company.

Capital market is a market is a market of short term security such as share, debentures, bond etc.

After the transaction of purchase and sales and per the order, the broker note down the details of transaction which is known as ‘Contract Note’.

National Securities Depository Limited was establishment in 1996 and it started its operation in the same year.

Treasury bill, commercial paper, call money etc. are traded in money market.

Treasury bill is issued at discount and repurchased at its face value.

Financial market is an important component of organized financial structure.

In capital structure, according to Gestenberg, types of securities and decisions related to it are reflected.

Scope of financial management is considered wide because it covers all financial decisions right from establishment of business to its expansion and end.

In company from due to the expense of preparing documents, such as registration fee, experts fees, legal expense etc. Fixed capital investment.

Instead of purchasing fixed assists like land, building , machinery they should be obtained on lease or reduce fixed capital investment.

The sources of fixed capital are promoters of business, owners of business, various types of securities, financial institutions and plugging back of profit.

Fixed capital is invested in assists like land, building, plant and machinery, furniture etc.

Managerial efficiency of performance means better result with less efforts.

Maximum working capital is required in labour industry.

Capital structure is a mix of various sources to raise required fund by the company.

Estimation of requirement of capital is capitalization.

Plugging back of profit reduces when major part is distributed as dividend.

Retained earning is important internal source of finance for a company.

Optimum capital structure is less risky and gives maximum return.

Dividend is a part of profit and it is a return gained by shareholder on investment.

Financial management has to determine the ratio of equity capital and debit in capital structure.

Assessment of investment should be in the context of expected return and risk.

Financial management creates financial stability and makes regular salary of the employees, and makes timely repayment to creditors and increases reputations.

Cash, debtors, raw material, saleable securities, bank balance, etc are included in current assists.

Prof. Solomon favored the objective of maximization of wealth.

Net present value of wealth means difference between present value of wealth and required capital investment.

Objective of maximization of wealth means difference between present value of wealth and required capital investment.

Company can increase earning per share through maximization of profit.