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प्रश्न
Varunica Ltd., a reputed truck manufacturing company, needs rupees twenty crores as additional capital to expand its business. Mr. Alind Jindal, the CEO of the company, wants to raise funds through equity. The Finance Manager, Mr. Nikhil Sachdeva, suggests that the existing shareholders be offered the privilege to subscribe to new issue of shares as per the terms and conditions of the company which was agreed by Mr. Alind Jindal.
Name the method through which the company decided to raise additional capital.
उत्तर
The method through which the company decided to raise additional capital is 'Rights Issue'.
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संबंधित प्रश्न
Answer the following question:
The Return on Investment (ROI) of a company ranges between 10 - 12% for the past three years. To finance its future fixed capital needs, it has the following options for borrowing debt:
Option ‘A’: Rate of interest 9%
Option ‘B’: Rate of interest 13%
Which source of debt, ‘Option A’ or ‘Option B’, is better? Give reasons in support of your answer. Also, state the concept being used in taking the decision.
Explain the following as factors affecting the requirements of fixed capital:
Technology upgradation
Explain the following as factors affecting the requirements of fixed capital:
Financing alternatives
State, with reason, whether the following statement is True or False.
Requirement of working capital does not depend upon any factor.
Ramnath is into the business of assembling and selling of televisions. Recently he has adopted a new policy of purchasing the components on three months credit and selling the complete product in cash. Will it affect the requirement of working capital? Give reason in support of your answer.
How does working capital affect both the liquidity as well as profitability of a business?
Write a word or a term or a phrase which can substitute the following statement :
The difference between current assets and current liabilities.
Answer the question.
Briefly explain any four types of working capital required by a business concern.
Why is working capital also known as circulating capital?
Higher working capital usually results in :
Higher dividend per share is associated with
A fixed asset should be financed through
Current assets of a business firm should be financed through
______ of a firm refers to those assets which can be converted into cash or cash equivalents in a short period of time.
______ decision involves the decision regarding the distribution of profit or surplus of the company.
Dhaval Acharya, after acquiring a bachelor’s degree in Hotel Management joined his father’s chain of vegetarian restaurants in Ahmednagar. Being young and enterprising, he suggested his father to add a new section of vegetarian bakery items which required an investment of ₹ 5 crores. His father Mr. Aariketh Acharya suggested him to take the decision with caution and understood everything comprehensively as bad decision may damage the financial fortune of business.
Identify the decision suggested by Mr. Aariketh Acharya. State by giving any three reasons as to why he must have advised his son to take decision with caution.
A business firm should have extra funds to meet future emergencies. Identify the type of working capital indicated here.
