Financial Management-Important Questions


CHAPTER 9: Financial Management

  1. Explain the term financial management?
  2. List any 5 factors determining the capital structure?
  3. Distinguish between over – capitalisation and under capitalisation?
  4. One of the effects of under – capitalisation is that the market value of shares goes up. But still under capitalisation is not considered good for the company”. Do you agree with this statement?
    Give reasons in support of your answer.
  5. You are the finance manager of a newly established company. The directors have asked you to determine the amount of working capital requirements for the company. State any 5 factors that you would take into consideration while determining the amount of working capital requirements of the company.
  6. What are the functions performed by the financial manager?
  7. State the factors affecting the dividend policy of a company?
  8. What is financial risk?
  9. Write the difference between fixed and working capital?