- Shares of stock represent ownership in a corporation.
- Ownership can easily be transferred to new owner.
- The corporation has unlimited life.
- Shareholders have limited liability.
- The most important characteristic of corporation is the management of corporation is always separate from its owner.
In a competitive market place, business must actively manage their funds to achieve their goals. Many tools and techniques have been developed to assist financial managers to recommend proper courses of action. These tools help the managers to determine which sources offer the lowest cost of fund and which activities will provide the greatest return on invested capital. Financial management is the field of greatest concern to the corporate financial officers and will be the major thrust of the approach that we will use in studying finance.