After calculating costs, they are multiplied by weights of various sources of capital to obtain a weighted cost of capital (WACC). The composite, cost of…

Net Income Approach:- The essence of net income approach is that the firm can increase its value or lower the overall cost of capital by…

According to the net operating income (NOI) approach the market value of the firm is not affected by the capital structure changes. The market value…

The traditional view, which is also known as an intermediate approach, is a compromise between the net income approach and the net operating approach. According…

The Modigliani-Miller (M-M) hypothesis is identical with the net operating income approach. (M-M) argue that, in the absence of taxes, a firm’s market value and…

Working capital management is an important component of overall financial management. Management of working capital like long-term financial decisions affects the risk and profitability of…

There is difference of opinion among different authors about the definition of working capital. Considering the objectives and scope of working capital, it can be…

For the efficient operation of the business, working capital is required along with the fixed capital. Working capital is needed for the purchase of raw…

Management of cash is one of most important areas of overall working capital management. This is due to the fact that cash is the most…

The main objective of managing cash flows is to accelerate collection of cash and delay disbursement of cash without damaging credit worthiness. After preparing cash…