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Analysis of Finance Management

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Submitted By pujudi
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Capital required for a business can be classifies under two main categories:
Fixed Capital
Working Capital

Fixed capital

It refers to any kind of real or physical capital (fixed asset) that is not used up in the production of a product and is contrasted with circulating capital such as raw materials, operating expenses and the like. Fixed capital is that portion of the total capital that is invested in fixed assets (such as land, buildings, vehicles and equipment) that stay in the business almost permanently, or at the very least, for more than one accounting period. Fixed assets can be purchased by a business, in which case the business owns them, but also leased, hired or rented, if that is cheaper or more convenient, or if owning the fixed assets is practically impossible.

FIXED CAPITAL
Every business needs funds for two purposes for its establishments and to carry out day to day operations. Long term funds are required to create production facilities through purchase of fixed assets such as plant and machinery, land and building, furniture etc. Investments in these assets are representing that part of firm’s capital which is blocked on a permanent or fixed basis and is called fixed capital.
Permanent or fixed working capital is the minimum amount which is required to ensure effective utilization of fixed facilities and for maintaining the circulation of current assets. There is always a minimum level of current assets which is continuously required by the enterprises to carry out its normal business operations.

FIXED CAPITAL IN COLGATE
FIXED ASSETS OF COLGATE COMPANY HAS INCREASED FROM 257,12.42 IN 2009 TO 260,72.97 IN 2010 WHICH IS GOOD FOR SMOOTH AND CONTINUOUS FLOW OF FUNDS

FIXED ASSET IN DABUR

Fixed assets of dabur company has increased from 30,832 in 2009 to 45,095 in 2010 which is appropriate

MEANING OF WORKING CAPITAL:

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