Nature and scope of financial management – objectives of financial management – financial decisions- financial management process –functional areas of financial management – Financial Goals – Profit maximization vs Wealth Maximization – Concept of time value of money

Cost of capital – Basic concepts, rational and assumptions – Cost of equity capital – Cost of debt – Cost of preference capital – Cost of retained earnings- Weighted Average Cost of Capital.

Investment decisions – Capital Budgeting – nature of capital budgeting – importance – capital budgeting process – kinds of decisions – evaluation of investment opportUnities – investment decisions tools – average rate of return, payback, NPV, IRR and PI methods.

Lease financing – types of lease financing – Operating Leverage – Financial Leverage – EBIT, EPS analysis – Combined Leverage – Capital Structure decision – factors determining capital structure – theories of capital structure – NI – NOI – Modigliani miller (MM) model.

Working capital management- operating cycle - determination of Working capital – Dividend policy -Forms of Dividend –Determinants of dividend policy - Dividend Theories: Walter’s model – Gordon and MM’s models