Marketing

Financial Management Important Topics- Equity shares, EAT, IRR, DIVIDEND, EQUITY TRADING

1.Define equity share?
2.Define wealth maximization?
3.what is meant by corporate mix?
4.write a short note on issues of debentures at discount?
5.what is the EAT?

6.Define property dividend?
7 Weather government polices affect the capital?

8 – What is trading on equity?

9 – What is the need for capital budgeting?

10-Write a short note on IRR?

1- Define equity share?

1.All shares that are not preferential shares are equity shares and are also known as ordinary shares. A person who holds equity shares has the right to vote in the company’s decisions. As an equity shareholder, you are entitled to receive a claim to any profits paid by the company in the form of dividends.

2.Define wealth maximization?

2.Wealth maximization is the concept of increasing the value of a business in order to increase the value of the shares held by its stockholders. … Similar reactions may occur if a business reports continuing increases in cash flow or profits.

3.what is meant by corporate mix?

3.Corporation tax is a tax imposed on the net income of the company. Description: Companies, both private and public which are registered in India under the Companies Act 1956, are liable to pay corporate tax. … If the net income exceeds Rs 10 cr, surcharge at the rate of 10% is levied.

4.write a short note on issues of debentures at discount?

4.When debentures are issued by the company at a price less than its nominal value (face value) it is said to be issued at discount. … For example, if a debenture of Rs. 2,000 is offered to the public at Rs. 1,950, it is issued at a discount.

5.what is the EAT?

5.Earnings after tax (EAT) is the measure of a company’s net profitability. It is calculated by subtracting all expenses and income taxes from the revenues the business has earned.

6.Define property dividend?

6.A property dividend is an alternative to cash or stock dividends, where a company gives shareholders property in lieu of cash or cash equivalents. Property dividends have monetary value even though they are considered a non-monetary type of dividend.

7 Weather government polices affect the capital?

7.Governments establish many policies that guide businesses. The government can make changes in fiscal policy which leads to changes in taxes, trade, subsidies, regulations, interest rates, licencing and more. … There are few international treaties which can influence the way companies to do business.

8 – What is trading on equity?

8.Trading on equity happens when a company incurs new debt using bonds, loans, bonds or preferred stock. The company then uses these funds to gain assets which will create returns which are larger than the interest of the new debt. Alternatively, trading on equity called financial leverage.

9– What is the need for capital budgeting?

9.Capital budgeting is important because it creates accountability and measurability. Any business that seeks to invest its resources in a project without understanding the risks and returns involved would be held as irresponsible by its owners or shareholders.

10-Write a short note on IRR?

10.The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. IRR is a discount rate that makes the net present value (NPV) of all cash flows equal to zero in a discounted cash flow analysis. IRR calculations rely on the same formula as NPV does

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