Financial Management

CONTENTS :

1. Financial Management : Nature, Scope and Objectives 2. Cost of Capital and Financing Decision 3. Capital Budgeting 4. Capital Structure : Theories and Determinants 5. Operating and Financial Leverage 6. Dividend Policy and Models 7. Management of Working Capital. 

SYLLABUS :

Unit-I    : Financial Management

Concept, Objectives and Significance.

Unit-II   :Cost of capital and Capital Budgeting

Meaning and Significance of Cost of Capital, Computation of Cost of Debt, Preference Capital, Equity Capital and Retained Earnings, combined (Weighted) Cost of Capital, Meaning and Significance of Capital Budgeting, Methods of Evaluating Investment Opportunities-Payback Period, Net Present Value, Internal Rate of Return.

Unit-III :Capital Structure

Traditional Approach of Capital Structure, MM Hypothesis, Factors, Affecting Capital Structure, Leverage—Operating Leverage, Financial Leverage, Combined Leverage, Measure-ment of Leverage.

Unit-IV :Management of Income

Retained Earnings—A Source of Internal Financing, Concept and Types of Dividend, Determinants of Dividend Policy, Dividend Polity—Walter’s Model and MM Hypothesis.

Unit-V  :Management of Working Capital

Meaning, Significance and Types of Working Capital, Sources of Working Capital, Determinants of Working Capital.