(Solved) - 1. What are the three basic questions Financial Managers must... (1 Answer) | Transtutors (2024)

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What are the three basic questions for financial managers? ›

What are the three basic questions Financial Managers must answer? What long-term investments should the firm choose? How should the firm raise funds for the selected investments? How should current assets be managed and financed?

Most financial management plans will break them down into four elements commonly recognised in financial management. These four elements are planning, controlling, organising & directing, and decision making. With a structure and plan that follows this, a business may find that it isn't as overwhelming as it seems.

The financial manager's responsibilities include financial planning, investing (spending money), and financing (raising money). Maximizing the value of the firm is the main goal of the financial manager, whose decisions often have long-term effects.

When it comes to managing finances, there are three distinct aspects of decision-making or types of decisions that a company will take. These include an Investment Decision, Financing Decision, and Dividend Decision.

The definition of financial management is the strategic practice of establishing, controlling, and monitoring all financial resources to achieve your business goals.

The income statement, balance sheet, and statement of cash flows are required financial statements. These three statements are informative tools that traders can use to analyze a company's financial strength and provide a quick picture of a company's financial health and underlying value.

The finance field includes three main subcategories: personal finance, corporate finance, and public (government) finance.

There are different types of financial managers, each with a specific focus. Examples include Risk Managers, Credit Managers, and Treasurer or Finance officers.

Determining your future needs in terms of investment, resources, funds. Determining the sources of funds. Managing or utilizing these funds efficiently.

Decisions are part of the manager's remit. The three main types of decisions are - strategic, tactical and operational.

What are the three basic financial decisions? ›

There are three types of financial decisions- investment, financing, and dividend. Managers take investment decisions regarding various securities, instruments, and assets. They take financing decisions to ensure regular and continuous financing of the organisations.

The goal of financial management is to maximize a company's shareholder value by making the best possible decisions about how to use its financial resources. There are three primary types of financial decisions that financial managers must make: investment decisions, financing decisions, and dividend decisions.

Corporate finance has three main areas of concern: capital budgeting, capital structure, and working capital. Capital budgeting deals with how the organization will invest in itself. Some of the long term investment which an organization can take include investing in stocks and index funds.

What are the three basic questions addressed by the study of finance? What long-term investments should the firm undertake? How should the firm raise money to fund these decisions? How can the firm best manage its cash flows as they arise in its day-to-day operations?

– What long-term investments should the firm take on? – Where will we get the long-term financing to pay for the investments? – How will we manage the everyday financial activities of the firm?

The income statement illustrates the profitability of a company under accrual accounting rules. The balance sheet shows a company's assets, liabilities, and shareholders' equity at a particular point in time. The cash flow statement shows cash movements from operating, investing, and financing activities.