Financial Management Principles And Applications Essay

Financial Management Principles And Applications - Essay Example long-run liability requires the payment of interest in pre-agreed periods which requires Beta to have enough liquidity to cover prompt payment of interest when it becomes due. Capital from sh atomic number 18holders can also be considered. This is advantageous since Beta will not be required to pay any dividends. However, issuing new shargons require the company to undergo accepted processes which can delay acquisition.After analyzing the advantages and disadvantages of utilizing different financing schemes, it is recommended that Beta raises fund through long-term debt. This is in consideration of the above discussion in addition to the fact that it already has a quite steep level of funds from shareholders.b. An organizations trading profit and loss account showing the revenues or funds generated the entity compared to the be and expenses incurred in its operation. In most companies, it starts with the revenue gen erated where the expenses are subtracted. The last line shows its net profit for the pecuniary period or for listed ones, the return to its stockholders. This financial statement is often the most popular one as it is used by creditors, stockholders, and even ordinary consumers. Entities considering to provide financing for the company also often gauged positivity and ability to pay based on profit and loss account.The balance sheet shows an entitys resources and how they are financed. The organizations assets and liabilities are often listed based on their liquidity, that is, on their capacity to be converted to cash easily. Balance sheets are often scrutinized by creditors and stockholders, the major sources of financing for the company. Balance sheets provide information about the companys level of supplement which informs stockholders and creditors about their share in the companys resources and the riskiness of investing in the company.