MODEL CREATION Introduction The main purpose of using financial model is to analyse and understand the financial situation of business for decision-making. .Finance needs various calculations to get precise information. There are different types of user e.g. managers and owners need the financial model to evaluate the risk and return to make business decisions for the smooth operation‚ Individual investors make logical investment decisions – ‘’Risk aversion’’ and etc.(Wild‚ Subramanyam and Halsey
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FINANCIAL MANAGEMENT INTRODUCTION Business firms exist because they satisfy a human need by providing a product or service. No business firm can be established without sufficient financing. The owner(s) therefore put personal loans they have entered into‚ and/or their hard-earned savings‚ at stake to partially finance the firm. The owner’s or owners’ contribution is referred to as owners’ equity. Normally‚ owners’ equity is not sufficient Borrowed funds (loans) have to be repaid through
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Financial intermediaries‚ particularly banks‚ are the most important source of external funds used to finance businesses (slide 9-chapter 7) Introduction: Financial intermediaries‚ particularly banks are a major source of finance for all businesses‚ providing finance for starting up‚ running the business and for expansion. Banks in Vietnam have the most important role in financing business activities. However‚ it is difficult task for small and medium-sized enterprises in Vietnam to get access to
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5 Analyzing financial statements using ratios 0011 0010 1010 1101 0001 0100 1011 Generally there are two approaches in analyzing financial statements by use of ratios: 1. Common size percentages – where a key item in the financial statements is identified and then all the other items are expressed as a percentage of the item. 1 Accounting and Reporting II 1 1.4 Analyzing financial statements using ratios 0011 0010 1010 1101 0001 0100 1011 Common size percentage can be applied as follows:
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Introduction……………………………………………………………………….2 2Literature Review…………………………………………………………………3 3Research methodology…………………………………………………………...4-5 4. Corporate Information……………………………………….…………………..6 5. Corporate Social Responsibilities………………………………………..………7 6.Analysis of Financial Statements (Ratio Analysis) …………………………….. iCurrent Ratio……………………………………………………………..8 iiQuick Asset Ratio………………………………………………….……..9 Leverage Ratio…………………………………………………….……….10 i)Debt to equity ……………………………………………………………..11 ii)Debt to Asset ……………………………………………………………12
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Working Capital Requirements and the Determining Factors in Pakistan Mian Sajid Nazir* and Talat Afza** Literature on corporate finance has traditionally focused on the study of long-term financial decisions. Researchers have examined‚ in particular‚ the investment decisions‚ capital structure‚ dividends or company valuation decisions‚ among other topics. However‚ short-term assets and liabilities are important components of total assets and need to be carefully analyzed. Management of these
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Assignment Chapter 10 True/False Indicate whether the statement is true or false. True 1. "Capital" is sometimes defined as the funds supplied by investors. True 2. The cost of capital should reflect the average cost of the various sources of long-term funds a firm uses to acquire assets. True 3. The component costs of capital are market-determined variables in the sense that they are based on investors’ required returns. False 4. The before-tax cost of debt‚ which is lower than the
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FINANCIAL RATIOS Gross Profit to Sales (Gross Profit Ratio): profitability ratio that shows the relationship between gross profit and total net sales revenue. Gross margin/Net sales The gross margin is not an exact estimate of the company’s pricing strategy but it does give a good indication of financial health. Without an adequate gross margin‚ a company will be unable to pay its operating and other expenses and build for the future. In general‚ a company’s gross profit margin should be stable
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Financial Ratio Analysis Splash * Profitability For the year 2010‚ Splash Corporation experienced a significant increase in its Operating Profit Margin‚ Return on Sales‚ Return on Equity‚ and Return on Assets because of High Net Income during the year. It is brought about by the large amount of Sales from Direct Selling business and better sales-mix. For the year 2011‚ the Company’s profitability has declined because of the increase in the cost of raw materials and increased spending on advertising
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that would normally have been placed in a bank or other financial institution (financial intermediaries) directly into investment instruments issued by the ultimate users of the funds. Investors and borrowers transact business directly and thereby bypass banks or other financial intermediaries. (2) The elimination of intermediaries between the first case providers of capital and the ultimate users of capital‚ withdrawal of funds from financial intermediaries such as banks‚ thrifts‚ and life insurance
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