MANAGEMENT

Detailed explanation-1: -A simple rate of return is calculated by subtracting the initial value of the investment from its current value, and then dividing it by the initial value. To report it as a %, the result is multiplied by 100.

Detailed explanation-2: -The fundamental principle of long-term finances is to finance the strategic capital projects of the company or to expand the company’s business operations. These funds are normally used for investing in projects that will generate synergies for the company in the future years.

Detailed explanation-3: -The statement of financial position is an accounting document that summarizes a company’s assets, liabilities and equity over a given period and a comparative period. In other words, it shows what the company owns and how its assets are financed. The balance sheet also shows the net book value of the company.

Detailed explanation-4: -The modern approach is an analytical way of looking into financial problems of the firm. According to this approach, the finance function covers both acquisition of funds as well as the allocation of funds to various uses.