Cn to the Green

 Cn towards the Blue Essay

Learning Objectives

Intended for Chapter doze

Explain the needs of financial management in corporate. Summarize the planning for economical management Explain the advantages and disadvantages of different techniques of short-term debts financing. Measure the advantages and disadvantages of equity auto financing. Evaluate the advantages and disadvantages of long lasting debt auto financing.

Chapter 12

MGT1101 Summary of Business

Understanding Financial Management

Chapter doze

MGT1101 Summary of Business

Make reference to page 357

Financial Program

Refer to page 362

Monetary Management

A plan for obtaining and making use of the money required to implement an organization's desired goals Human // Material // Information // Financial

The Definition

Resources happen to be needed to achieve a company's aim

goals

Chapter-6 Recall: Managing

Human // Material // Information // Financial

Producing the economic plan

Assets are necessary to achieve a provider's goal

goals

So , Economic Management is all the activities concerned with using money effectively ensuring money is used in keeping with the goal

Phase 12 MGT1101 Introduction to Organization

o obtaining money (financing)

D Deciding the best ways to increase money watts

(one of the resources)

Section 12

CASH

MGT1101 Introduction to B Business

Refer to web page 362

Label page 362

3 Steps in Developing the Financial Strategy

Sources of funds Budgeting Define Goals Causes of funds

three or more Steps in Growing the Economic Plan

To determine how much money should be used

Budget

Monetary report that projects profits and/or bills over a specified future period

Define Desired goals

Budgeting

To ascertain organizational desired goals

Goal An end result that an organization desires to achieve on the one- to ten-year period

• Must be specific and measurable • Must be genuine

MGT1101 Introduction to Business Part 12

MGT1101 Introduction to Organization

Chapter doze

Refer to page 362 Types of funds Define Goals

Refer to page 362

3 Steps in Developing the Financial Plan

3 Measures in Developing the Financial Plan

Budgeting Causes of funds

Establish Goals

Spending budget

To determine how much money is needed

To determine how much money is necessary

New Stock (Plant)

1 ) Cash finances: To task cash statements and expenses over a specified

2 . Capital budget

Quotes a business expenditures intended for major assets and its long-term financing demands

period

Classic budgeting Based upon dollar portions in plan for preceding year

Zero-based budgeting Every charge in every price range must be justified

MGT1101 Introduction to Business

Part 12

MGT1101 Introduction to Business

Chapter 12

Refer to webpage 363

several Steps in Expanding the Financial Plan

Long term Debt Funding Retained Generating

Sources of funds

Define Desired goals

Budgeting

To identify the sources of funds Initial Debt Financing Debt Funding Debt Revenue of Assets

Selling Share Equity Financing

Sources of Finance

Sales Profits

Equity

Causes of Funds

MGT1101 Introduction to Business

19 Chapter 12| on the lookout for

MGT1101 Summary of Business

Section 19 | 10 12

Sources of Cash

Equity S-T Debt

Refer to page 365

Sources of Cash

L-T Debt

Refer to webpage 366-367 Collateral

S-T Debt

L-T Debts

Short-term financial debt financing is generally easier to get than long term

Short-term debt financing is often easier to get hold of than long lasting • Shorter repayment period means fewer risk of non-payment • Levels of short-term loans are less space-consuming than long-term loans

• Shorter repayment period means much less risk of nonpayment

• Numbers of short-term loans are less space-consuming than long-term loans

Unsecured S-T debt

Secured S-T debts

Unsecured S-T debt

Loans not backed with collateral a few. Unsecured loans from banks

Secured S-T debt

Financing not backed by collateral

1 . Trade credit rating

Financing prolonged by a owner who does certainly not require...


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