Fixed Assets - This type of assets indicate the infrastructural facilities and properties required by the organisation. Fixed assets are the assets which bring profits in the long span of time. The investments decisions in this type of assets are technically referred as "Capital Budgeting Decisions" and generally concerned with the following -
- How one should select the fixed assets which are actually needed by the business or fulfill the business purpose?\
- What are the methods or modes of analysis of the type of investments to be done in this type of assets?
- Incase of uncertainity and risk, how one should make a decision to invest in Fixed assets?
Current assets: - Assets that are generated over during the operations and are capable of converting into the form of cash or getting utilised within the short period of time,lets say one year.
The type of investments decisions which are made so as to invest in Current assests are technically refferd as "Working Capital Managemt" and are generally concerned with -
- What are the objectives of the WCM?
- Why there is the need of WCM?
- What are the factors that can affect the requirement of working capital?
- How one could quantify the requirement of WC?
- What are the sources available for financing the requirements of WC?
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