What is Financial Management ? Explain Briefly with Examples.
Financial management is concerned with the acquiring ,managing and financing assets with some goal in minds . this is basic them of Financial management . Liabilities and owner equity are at right side of balance sheet and Assets are at left side of balance Sheet.
Dividend Pay Out Ratio :
Annual Cash Dividend divided by annual earning
Annual Cash Dividend / Annual Earning
DPS/EPS : This ratio indicates the percentage of company earning that is paid out to share holders in cash .
What is Earning Per Share ?
Earning after taxes divided by Common shares is called Earning per share
What is Agent ?
Individual authorized by other person to act on his behalf is called agent and person is called principal
Agency Theory ?
A branch of economic that deals with behavior of agent and principal is called agency theory .
What is Corporate Social Responsibility ?
Business Outlook that acknowledge the firm responsibility to his Stack holders with natural environments .
What are Stack Holders ?
All components of firm like creditors, investors, employees,suppliers, etc
Meeting the needs of present with out the compromising the ability of future generation to meet their own needs
Corporate Governance ?
The system by which the corporation are managed and controlled .
he is not personally liable for debts of partnership
A business form separates from its owners ,limited liability ,unlimited life,ability to raise the funds and easy transfer owner ship .
Durable Taxation :
When same income is taxed at towice it is called Durable taxation.
Straight Line Depreciation ?
A method of depreciation that allocates the expense during depreciate life of assets .
These are some important terminology for finance and these are for chapter 1 that are very important to understand the main terminology of finance which are basic them of finance and financial institutes.