P/L Account
DEFINITION
A branch of economics concerned with resource allocation as well as resource management, acquisition and investment. Simply, finance deals with matters related to money and the markets. To raise money through the issuance and sale of debt and or equity MEANING OF FINANCE
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Finance is the study of how investors allocate their assets over time under conditions of certainty and uncertainty. A key point in finance, which affects decisions, is the time value of money, which states that a unit of currency today is worth more than the same unit of currency tomorrow. Finance aims to price assets based on their risk level, and expected rate of return. Finance can be broken into three different sub categories: public finance, corporate finance and personal finance.
THE ROLE OF FINANCE. A. COMPARING THE ACCOUNTANT AND THE FINANCIAL MANAGER. The role of an accountant is like a skilled technician who takes measures of a company’s health and writes a report financial managers examine the data prepared by accountants and make recommendations to top management regarding strategies for improving the company’s financial strength. (2) A manager cannot make sound financial decisions without understanding accounting information. (3) The need for careful financial management remains an on-going challenge in a business throughout its life. (4) The most common ways for firms to fail financially are: (a) Undercapitalization or not enough funds to start with. (b) Poor cash flow, or cash in minus cash out. (c) Inadequate expense control.B. THE IMPORTANCE OF UNDERSTANDING FINANCE. (1) The text describes a small organization called parsley patch, begun on a shoestring budget. (2) When the owners expanded into the
A branch of economics concerned with resource allocation as well as resource management, acquisition and investment. Simply, finance deals with matters related to money and the markets. To raise money through the issuance and sale of debt and or equity MEANING OF FINANCE
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Finance is the study of how investors allocate their assets over time under conditions of certainty and uncertainty. A key point in finance, which affects decisions, is the time value of money, which states that a unit of currency today is worth more than the same unit of currency tomorrow. Finance aims to price assets based on their risk level, and expected rate of return. Finance can be broken into three different sub categories: public finance, corporate finance and personal finance.
THE ROLE OF FINANCE. A. COMPARING THE ACCOUNTANT AND THE FINANCIAL MANAGER. The role of an accountant is like a skilled technician who takes measures of a company’s health and writes a report financial managers examine the data prepared by accountants and make recommendations to top management regarding strategies for improving the company’s financial strength. (2) A manager cannot make sound financial decisions without understanding accounting information. (3) The need for careful financial management remains an on-going challenge in a business throughout its life. (4) The most common ways for firms to fail financially are: (a) Undercapitalization or not enough funds to start with. (b) Poor cash flow, or cash in minus cash out. (c) Inadequate expense control.B. THE IMPORTANCE OF UNDERSTANDING FINANCE. (1) The text describes a small organization called parsley patch, begun on a shoestring budget. (2) When the owners expanded into the