Finance term paper deals with this very important function of every business organizations. In this writing we will discuss about this very important function of every organization. The custom term paper is tailor made by all of our writers.
Some firms create manufacturing capacities for production of goods; some provide services to consumers. They sell their goods or services to earn profit. They raise funds to acquire manufacturing and other facilities. Thus the three most important activities of a business firm are: finance, production and marketing. A firm secures what ever capital it needs and employs it in activities which generate returns on invested capital. Our help term paper on this subject makes sure to include all the essentialities.
A firm requires a number of real assets to carry on its business. Real assets can be tangible or intangible. Plant, machinery, office, factory, furniture and buildings are examples of tangible assets while technical know how, technological collaborations, patents and copyrights are intangible assets. Write my term paper is very crucial for success of every student.
The firm sells financial assets or securities, such as shares and bonds or debentures, to investors in capital markets to raise necessary funds. Financial assets also include lease obligations and borrowing from banks, financial institutions and other sources. Funds applied to assets by the firm are called capital expenditures or investment. The firm expects to receive returns on its investment and distribute returns to investors. There are two types of funds that a firm can raise: equity funds and borrowed funds.
A firm has to sell shares to acquire equity funds. Shares represent ownership rights of their holders. Buyers of shares are called shareholders and they are the legal owners of the firm whose shares they hold. Another important source of securing capital is creditors or lenders. Lenders are not owners of the company. They make money available to the firm on lending basis and retain title to the funds lent. The return on loans or borrowed funds is called interest. Loans are furnished for a specified period at a fixed rate of interest. Payment of interest is a legal obligation.
There exists a inseparable relationship between finance on the one hand and production, marketing and other functions on the other. Almost all kinds of business activities, directly or indirectly, involve the acquisition and use of funds. For example, recruitment and promotion of employees in production in production is clearly a responsibility of the production department; but it requires payment of wages and salaries and other benefits, and thus, involves finance. Our example term paper would suite every need.
Similarly, buying a new machine or replacing an old machine for the purpose of increasing productive capacity affects the flow of funds. Sales promotion policies come within the purview of marketing, but advertising and other sales promotion activities require outlays of cash, and therefore, affect financial resources.
The functions of this subject include:
1) Investment or long term asset mix decision
2) Financing or capital mix decision
3) Dividend or profit allocation decision
4) Liquidity or short term asset mix decision
A firm performs these functions simultaneously and continuously in the normal course of the business.
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