Quick Answer: What Are The Factors Affecting Financing Decision?

Explain the following as factors affecting financing decision

  • Cost. The cost of raising funds from different sources are different.
  • Risk. The risk associated to each of the source is different.
  • Floatation Cost.
  • Cash Flow Position of the Company.
  • Fixed Operating Cost.
  • Control Considerations.
  • State of Capital Market.
  • Return on Investment (RQl)

11 Oct 2016

What are the factors affecting financial decisions?

Internal factors affecting financial decisions include nature of the business, the size of business, expected return, the cost and risk involved, the asset structure of the business, the structure of ownership, the expectations of investors, the age of the firm, the liquidity in company funds and its working capital 10 Mar 2019

What are the factors affecting financial management?

Functions such as record keeping, financial reporting and fundraising help a firm ease its route to financial success. Factors affecting financial management include government regulations, the state of the economy, securities exchanges and borrowing costs.26 Sep 2017

What are some factors a manager must consider when making a financing decision?

Below are some of the factors that we should consider before deciding on a source that most suits our business needs.

  1. 1) Risk. Risk is an important element to consider.
  2. 2) Cost.
  3. 3) Control.
  4. 4) Long term versus short term borrowing.

What are two economic factors that affect financial decisions?

  • Consumer prices. changes in how much the dollar is worth.
  • Inflation. rising prices for goods and services and lower buying power of the dollar.
  • Consumer Spending. the demand for goods and services, which affects prices and job opportunities.
  • Interest Rates.
  • Unemployment Rate.
  • Personal Risk.
  • Inflation Risk.
  • Interest- Rate Risk.

What are the 3 types of financial management decisions?

There are three types of financial management decisions: Capital budgeting, Capital structure, and Working capital management.

What are the major financial decisions?

There are three decisions that financial managers have to take: Investment Decision. Financing Decision and. Dividend Decision.

What are financial factors?

Financial Factors. It is a score card on the financial performance of your business that reflects when sales are made and when expenses are incurred. It draws information from the various financial models developed earlier such as revenue, expenses, capital (in the form of depreciation), and cost of goods.

What factors affect personal financial planning?

Personal circumstances that influence financial thinking include family structure, health, career choice, and age. Family structure and health affect income needs and risk tolerance.

What are financial decisions?

financial decision. Financial decision is a process which is responsible for all the decisions related with liabilities and stockholder’s equity of the company as well as the issuance of bonds.