StudentShare solutions
Triangle menu

Financial Decision Making - Essay Example

Extract of sample
Financial Decision Making

Therefore, it won't be an exaggeration to say that finance is the lifeblood of all enterprises. This is particularly so when economics are undergoing structural changes and economic reforms are in the making to introduce greater elements of competitive forces. In a competitive environment managers are faced with a challenge to compete for resources and to find a better utilization of such resources. Finance is a specialized subject in itself but it draws heavily on other related functions like marketing, production, personnel, purchase etc. Drury (2004, p.5) states "Management accounting is concerned with the provision of information to people within the organization to help them make better decisions and improve the efficiency and effectiveness of existing operations"
(Lev, 2001) stated that existing financial accounting standards sharply distinguish between physical and intangible assets. While physical assets (e.g., property, plant, and equipment) are valued on the balance sheet at the price paid to obtain them, less accumulated depreciation, intangible "assets" are expensed as incurred. Accounting is therefore considered an integral part of the knowledge management within an organization. ...
What mix of equity and debt to use
How much financial risk to take
Making a calculated financial decision makes a big difference between a prosperous and growing business and a liability. The prime function of a management executive in a business organization is decision-making and forward planning. Decision making means the process of selecting one action from two or more alternative courses of action whereas forward planning involves means establishing plans for the future. The question of choice arises because resources such as capital, land, labor and management are limited and can be employed in alternative uses. The manager is thus supposed to analyze the past data, current information and the estimates about future predicted as best as possible. This application of economic theory to business management is known as managerial economics. This is micro-economic in character as the unit of study is the company. The following aspects are said to be generally under the ambit of managerial economics;
Demand analysis and forecasting
Cost and production analysis
Pricing decisions, policies and practices
Profit management
Capital management.

Often a distinction is made between management accounting and financial accounting. Management accounting measures and reports financial and non-financial information that helps managers make decisions to fulfill the goals of the organization. Its focus is on internal reporting. On the other hand financial accounting is considered to have a focus on reporting to external parties. It measures and records business transactions and provides financial statements that are based on the 'Generally Accepted Accounting Principles (GAAP)'. Therefore managers are responsible for the financial statements ...Show more


In today's fast changing economic environment, competitiveness, in terms of cost and productivity, has become the key to success for any productive enterprise. The task of managing finance has traditionally been entrusted to financial executives, but in the changed scenario, such a responsibility has become very relevant at all the key decision making points in an organization…
Author : bergegisselle
Financial Decision Making essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Financial Decision Making"
with a personal 20% discount.
Grab the best paper

Check these samples - they also fit your topic

Financial Decision Making
Generally for publicly traded stocks the process of comparing the stock’s performance can be done much easier than a non public company. Traditionally individuals looking to invest in publicly traded company investors can use the price earnings ratio and eps.
3 pages (750 words) Coursework
Financial Decision Making Essay
If the investment is a fixed asset, it is more likely to incur huge capital outlay which can only be recouped after some years of operation. If the company is not able to generate sufficient funds to pay up, it can jeopardize Beta's credit worthiness. Long-term liability seems to be more appropriate than short-term ones considering that it will be used for the purchase of a fixed asset.
5 pages (1250 words) Essay
Financial Modeling With Decision Making
The spread sheet is used to calculate the profit and loss through the investment done on purchasing shares. The features in the spread sheet are about the share purchase transactions, about brokerage charges, share buying prices, selling prices, the number of shares, the total value of shares of a particular company.
6 pages (1500 words) Essay
Strategic and Financial Decision Making
Borrowings include loans from financial institutions; corporate bonds etc. while shareholders funds include equity share capital, preference share capital, accumulated profits. However, the amount of risk involved in both the sources of financing differs.
8 pages (2000 words) Essay
Financial Decision Making
A benchmark is a standard measurement that forms the basis for comparison. Conclusions on the study provide information wherein Abel Athletics should focus its future plans. The financial statement is a management tool that will allow us to
6 pages (1500 words) Essay
Strategic and Financial Decision-making
For the assignment Sage Group (SGE) and Diageo Plc (DGE) have been selected. Sage Group is a software and computer services company in UK. Diageo Plc is a leading company in premium drinks with a collection of brands across wine, spirit
9 pages (2250 words) Essay
Strategic and Financial Decision-making
The stocks are issued by different public sector companies and the investors buy and sell the stock keeping in mind the market situation and the forecast made. Most of the investors are influenced by
8 pages (2000 words) Essay
Financial and Managerial Accounting for Decision Making
The head of the production department has approved all the short listed machines and now the decision rests with the financial control unit in order to evaluate the financial feasibility of the purchasing decision. Future
8 pages (2000 words) Essay
Financial decision making
trategies of its business operations in the foreseeable future, but also provides reasonable estimates regarding the financial prospects of the business. The forecasted financial prospects of the business mainly describe the profitability, cash flow position and net worth of the
3 pages (750 words) Essay
Financial Reporting and Analysis for Decision Making
The other bodies governing the Hong Kong Financial reporting operates as; Hong Kong Financial Reporting Standards (HKFRS), Accounting standards (HKAS)
12 pages (3000 words) Essay
Hire a pro to write
a paper under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
Comments (0)
Click to create a comment
Contact Us