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    Basic Finance

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    Jonalyn Fausto Carbonel
    The document discusses financial planning and working capital management. It describes the seven steps in financial planning as setting goals and objectives, identifying resources needed, determining costs, identifying financing sources, establishing a schedule, establishing controls, and determining contingencies. It notes that quantifying plans is important for business planning and management because it provides structure, consistency, and organization for a company's future activities. The document includes exercises on shareholders wealth maximization and budget preparation with a table to fill in quarterly and annual production budget data.

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    Basic Finance

    Uploaded by

    Jonalyn Fausto Carbonel
    10 views2 pages
    The document discusses financial planning and working capital management. It describes the seven steps in financial planning as setting goals and objectives, identifying resources needed, determining costs, identifying financing sources, establishing a schedule, establishing controls, and determining contingencies. It notes that quantifying plans is important for business planning and management because it provides structure, consistency, and organization for a company's future activities. The document includes exercises on shareholders wealth maximization and budget preparation with a table to fill in quarterly and annual production budget data.

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    Basic Finance (1)

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    The document discusses financial planning and working capital management. It describes the seven steps in financial planning as setting goals and objectives, identifying resources needed, determining costs, identifying financing sources, establishing a schedule, establishing controls, and determining contingencies. It notes that quantifying plans is important for business planning and management because it provides structure, consistency, and organization for a company's future activities. The document includes exercises on shareholders wealth maximization and budget preparation with a table to fill in quarterly and annual production budget data.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    10 views2 pages

    Basic Finance

    Uploaded by

    Jonalyn Fausto Carbonel
    The document discusses financial planning and working capital management. It describes the seven steps in financial planning as setting goals and objectives, identifying resources needed, determining costs, identifying financing sources, establishing a schedule, establishing controls, and determining contingencies. It notes that quantifying plans is important for business planning and management because it provides structure, consistency, and organization for a company's future activities. The document includes exercises on shareholders wealth maximization and budget preparation with a table to fill in quarterly and annual production budget data.

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    JONALYN F.

    CARBONEL BSBA FM-4A


    CHAPTER-III
    FINANCIAL PLANNING AND WORKING CAPITAL MANAGEMENT

    EXERCISE 1: SHAREHOLDERS WEALTH MAXIMIZATION


    1. What are the different steps in financial planning? Discuss each briefly
    1. Set goals /objectives- the goals of a company can be divided into short term, medium
    term, and long term goals.
    2. Identify resources-once goal and objectives are set, the next step is to identify the
    resources needed to meet the goals and objectives and make this part of the plan.
    3.Determine the financial cost of executing the plan-once the resources needed are
    established, the next step is to determined financial cost for companies that plan to
    maintain present operations, provisions have to be made for possible increases in
    production cost and salaries of employees due to inflation.
    4.identify the sources of financing-from the budget, the next step is to identify the sources
    of financing- how much will come from equity and borrowing.
    5.Established an evaluation or a schedule as to when the resources will be needed- once
    have the budgets are prepared and the financing sources are identified, the time as to
    when these resources will be needed should be determined as well.
    6.Established an evaluation for monitoring and controlling – the management must
    established a mechanism that will allow plans to be monitored.
    7.Determine contingency plans- In planning, contingencies must be considered as well.
    Determine contingency plans-In planning contingencies must be considered as well.

    2.Why is it important to quantify plans?


    When it comes to planning, most people think of things like schedules and organization. While
    these are important aspects of effective planning, there’s much more to it than that! Good
    planning can help you achieve your goals and dreams by keeping you on track and focused in
    business, and in life. Plans are important. Although they may seem like an onerous mechanism
    designed to burden you with strict regulations and stressful deadlines, the planning process can
    actually be a liberating force that opens your mind to new possibilities and helps you put your
    ideas into action. Planning is important in business and management because it gives companies
    a firm structure for their future so that their activities are consistent and organized.
    EXERCISE 2: BUDGET PREPARATION
    a. Prepare a production budget schedule for 2020 showing quarterly data
    Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year
    Budgeted
    Sales in units
    Target ending
    Inventories
    Beginning
    Inventories
    Production
    Producted
    Sales
    Unit price
    Total in pesos

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