Short terms working capital, Financial Management

Assignment Help:

Q. Short terms working capital?

1) Indigenous bankers: private money leased and other country banking used to be the only source of finance prior to the establishment of the commercial bank they used charge every high rate of the interest and exploited the customer to the largest extent is possible . now a day with the develop of commercial bank they have lost their monopoly . but every today some business house have to depend on the indigenous bankers for obtaining loans to ,meet their working capital requirement

2) trade creditors: trade creditors refers to the credit extended possible Interest. The firm may lose sales also because of shortage of stock and tight credit policy of the firm. Thus there is a cost of illiquidity which increases with the less and less level of current assets. The optimum level of current assets can be determined by balancing the cost of liquidity and the cost of illiquidity. The optimum level is the point where the total cost is the minimum.


Related Discussions:- Short terms working capital

Cost of capital.., your firm is considering its household products division...

your firm is considering its household products division. you identify John Lewis as a firm with comparable investments. suppose J.L. equity has a market capitalization of 150 bill

What is risk aversion, What is risk aversion? If common stockholders are ri...

What is risk aversion? If common stockholders are risk averse, how do you explain the fact that they often invest in very risky companies? Risk aversion is the tendency to evad

Why do financial managers calculate the marginal tax rate, Why do financial...

Why do financial managers calculate the marginal tax rate? Financial managers utilize marginal tax rates to calculate the future after-tax cash flows from investments.  Ever si

How can we estimate that firm is going to benefit, Ho can we estimate that ...

Ho can we estimate that firm is going to benefit from projec To calculate how firm is going to benefit from project we need to calculate whether firm is earning the required ra

Determine the advantages of explicit cost, Determine the advantages of expl...

Determine the advantages of explicit cost Explicit cost of an interest bearing debt will be the discount rate which equates present value of the contractual future payments of

Estimate sales price of gas, A proposal to extend the ABC Gas Company Ltd's...

A proposal to extend the ABC Gas Company Ltd's gas distribution network to the NOIDA industrial cluster, about 40 km east of Delhi, at distance of about 20 kms from the ABC's exist

Leverage, Evaluate d importance of leverage in a financial management of a ...

Evaluate d importance of leverage in a financial management of a small sacle business

What is bid, Bid The price buyers provide to acquire securities or pri...

Bid The price buyers provide to acquire securities or privacy from sellers.

Calculate the net investment of the firm, Problem: i) Assume a firm bu...

Problem: i) Assume a firm buys a new tooling machine for Rs 2000,000, installation costs net of taxes are Rs 300,000. An existing asset has a book value of Rs 400,000 and the

Define burden of a tax is shared by producers and consumers, The burden of ...

The burden of a tax is shared by producers and consumers.  Under what conditions will consumers pay most of the tax?  Under what conditions will producers pay most of it?  What det

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd