1. Sources of Business Finance

Businesses require finance for various purposes, from starting up to expansion. Sources of business finance can be broadly categorized into internal sources (like retained earnings, owner's capital) and external sources (like bank loans, issue of shares and debentures, trade credit). The choice of source depends on factors like cost, risk, and the amount of funds required.

2. Financial Management Concepts and Decisions

Financial management involves the efficient acquisition, allocation, and utilization of financial resources. Key concepts and decisions include investment decisions (what assets to acquire), financing decisions (how to raise funds), and dividend decisions (how to distribute profits). Sound financial management is crucial for the profitability and sustainability of any business.

3. Financial Planning and Capital Structure

Financial planning involves determining the financial objectives and the means to achieve them. It includes forecasting financial needs, estimating resources, and developing strategies for fund utilization. Capital structure refers to the mix of debt and equity used to finance the business. An optimal capital structure aims to minimize the cost of capital and maximize firm value.

4. Fixed and Working Capital

Businesses require both fixed capital for long-term assets like land, buildings, and machinery, and working capital for day-to-day operations, such as meeting short-term liabilities and funding inventory. Efficient management of both fixed and working capital is essential for smooth operations, liquidity, and profitability.