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प्रश्न
Rizul Bhattacharya after leaving his job wanted to start a Private Limited Company with his son. His son was keen that the company may start manufacturing of Mobile-phones with some unique features. Rizul Bhattacharya felt that the mobile phones are prone to quick obsolescence and a heavy fixed capital investment would be reuired regularly in this business. Therefore he convinced his son to start a furniture business.
Identify the factor affecting fixed capital requirements which made Rizul Bhattacharya to choose furniture business over mobile phones.
उत्तर
‘Technology upgradation’ is the factor affecting fixed capital requirements.
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संबंधित प्रश्न
Big retail stores requires large amount of ............................. capital.
- Fixed
- Working
- Loan
Answer the following question:
In the paint industry, various raw materials are mixed in different proportions with petroleum for manufacturing different kinds of paints. One specific raw material is not readily and regularly available to the paint manufacturing companies. Bonler Paints Company is also facing this problem and because of this, there is a time lag between placing the order and the actual receipt of the material. But once it receives the raw materials, it takes less time in converting it into finished goods.
Identify the factor affecting the working capital requirements of this industry.
‘Reliable Transport Services Ltd.’ specialises in transporting fruits and vegetables. It has a good reputation in the market as it delivers the fruits and vegetables at the right time and at the right place.
A state with reason whether the working capital requirements of ‘Reliable Transport Services’ will be high or low.
Explain the following as factor affecting the requirements of fixed capital:
Natural of business
Explain the following as factor affecting the requirements of fixed capital:
Diversification
Explain the following as factor affecting the requirement of working capital:
Business cycle
Explain the following as factor affecting the requirements of working capital:
Operating efficiency
Explain the following as factor affecting the requirements of working capital:
Availability of raw material
Explain the following as a factor affecting the requirement of working capital:
Level of competition
Attempt the following
What are the factors affecting requirement of fixed capital ?
What is Working Capital? Factors affecting requirement of Working capital?
Discuss in brief any four factors that affect the working capital requirement of a company.
Higher debt-equity ratio results in
Which fund in an organisation possess finance for day to day operations
Match the factors affecting fixed capital requirements given in Column - I with their explanations given in Column - II:
| Column - I | Column - II | ||
| (A) | Nature of Business | (i) | A trading organisation needs lower investments in fixed assets as compared to a manufacturing organisation. |
| (B) | Technology upgradation | (iii) | A textile manufacturing company is installing a cement manufacturing plant and thus its investments in fixed assets is increasing. |
| (C) | Diversification | (iii) | A capital-intensive organisation requires higher investments in fixed assets as compared to labour- intensive organisation. |
| (D) | Choice of Technique | (iv) | Mobile phones became obsolete faster and are replaced much sooner than furniture or many other assets. Hence, these type of businesses require more fixed capital. |
Ratan Ltd. needs to raise funds from the financial market and, hence, considers issuing equity shares. State any four reasons to explain why this source of raising funds is considered by the company.
