FM (BCOM 6th)

UNIT-I

Financial Management- goals of financial management – financial decisions – financial

planning – objectives and principles of sound financial planning – long term and short term

financial plan – factors affecting financial plan.

UNIT-II

Financing Decisions – capital structure – factors influencing capital structure – EBIT – EBTEPS

–analysis .Financial and Operating Leverages.Dividend Decisions – dividend policy –

determinants of dividend policy – types of dividend policy– forms of dividend. Walter’s

Model- Gordon’s Model- MM’s Hypothesis (problems)

UNIT-III

Cost of Capital.Investment Decisions – capital budgeting – significance – techniques of

evaluation of investment proposals- payback method – return on investment method, net

present value method and IRR Methods. Risk Analysis- probability approach, expected

values – standard deviation – sensitivity Analysis – decision tree Analysis (Problems)

UNIT-IV

Planning and forecasting of working capital, importance of adequate working capital- excess

or inadequate working capital – determinants of working capital requirement – cash

management, receivable management and inventory management – sources of working

capital.