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Introduction What is a rights issue? A rights issue is an issue of new shares for cash to existing shareholders in proportion to their existing holdings. A rights issue is, therefore, a way of......
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Introduction What is equity? Equity is the term commonly used to describe the ordinary share capital of a business. Ordinary shares in the equity capital of a business entitle the holders to......
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Introduction As we discussed in our introduction to asset finance, the use of hire purchase or leasing is a popular method of funding the acquisition......
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Introduction There are three main ways of raising equity finance: - Retaining profits in the business (rather than distributing them to equity......
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the cost of acquiring an asset, to coincide with the timing of the revenue generated by the business.The most common sources of medium term finance......
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) The Stakeholder Concept Shareholder Concept - Maximising Shareholder Wealth In the theory of accounting and finance, it is assumed that the objective......
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The importance of working capital Definition of working capital The net working capital of a business is its current assets less its current liabilities Current Assets include: - Stocks of......
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Introduction The working capital cycle can be defined as: The period of time which elapses between the point at which cash begins to be expended on the production of a product and the collection......
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Issues of Finance Overseas Direct Investment (ODI) Foreign investment from private firms. However, this goes to a very limited number of countries......
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Accounting and Finance Topic List Company Accounts Capital and Revenue Expenditure Interpretation of profit and Loss and Balance Sheets Working......
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run). This will move them closer to the MES and they can take better advantage of economies of scale. A lack of finance may prevent movement along......
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Market failure occurs when the price mechanism fails to produce the goods consumers want. The Pareto optimum is not achieved. There is no productive or allocative efficiency. Efficiency......
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There is general agreement that, before it can be regarded as useful in satisfying the needs of various user groups, accounting information should satisfy the following criteria:......
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Annual report · An annual report is a document produced annually by companies designed to portray a true and fair view of the company's annual performance, with audited financial statements......
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In our introduction to interpreting financial information we identified five main areas for investigation of accounting information. The use of ratio analysis in each of these areas is......
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There are two main forms of accounting information: (1) Financial Accounts, and (2) Management Accounts Financial Accounts - A Definition Financial accounts are concerned with classifying,......
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Introduction It is not easy to provide a concise definition of accounting since the word has a broad application within businesses and applications. The American Accounting Association......
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It is easy to assume that the only users of accounting information are shareholders - since it is a requirement of company law that shareholders must receive periodic accounting statements.......
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Incremental budget · This is a budget prepared using a previous period's budget or actual performance as a basis with incremental amounts added for the new budget period · The allocation of......
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Introduction An important distinction is made in accounting between "current assets" and " "fixed assets". Current assets are those that form part of the circulating capital of a business. They......