Understand the Financial Engine of Every Business — From Fundamentals to Application!

Designed for BCom First Semester students, this comprehensive textbook on Business Finance introduces the core principles of financial management and decision-making in a business context. With clear theory, real-world Indian examples, and exam-focused numericals, this book builds the financial literacy every commerce student needs to succeed — in exams and in professional life.

💰 Topics Covered

Unit I — Introduction to Business Finance

• Meaning, nature, scope & importance of business finance
• Objectives of financial management — profit maximisation vs wealth maximisation
• Functions of a finance manager
• Relationship of finance with economics & accounting
• Financial planning — meaning, importance & limitations

Unit II — Sources of Business Finance

• Classification of sources — internal & external, short-term & long-term
• Equity shares, preference shares & debentures
• Retained earnings, depreciation funds & ploughing back of profits
• Bank loans, trade credit, commercial paper & factoring
• Venture capital, angel investors & crowdfunding — modern sources

Unit III — Capital Structure

• Meaning & significance of capital structure
• Factors affecting capital structure decisions
• Theories of capital structure — Net Income, Net Operating Income & Modigliani-Miller approach
• Leverage — operating, financial & combined leverage with solved numericals
• EBIT-EPS analysis & indifference point

Unit IV — Cost of Capital

• Meaning, importance & components of cost of capital
• Cost of equity — dividend growth model & CAPM approach
• Cost of debt, preference capital & retained earnings
• Weighted Average Cost of Capital (WACC) — concept & calculation
• Marginal cost of capital

Unit V — Working Capital Management

• Concept, types & importance of working capital
• Factors affecting working capital requirements
• Working capital estimation — operating cycle approach
• Management of cash, receivables & inventory
• Financing of working capital — sources & strategies

✅ Key Features

• Concept-first approach — theory explained before numerical application
• Abundant solved numericals — WACC, leverage, EBIT-EPS & working capital estimation
• Chapter-end MCQs, short answer & university-style long answer questions
• Indian business context with relevant corporate examples & RBI/SEBI references
• Aligned with major Indian university syllabi (NEP 2020 compatible)
• Ideal for self-study, classroom use & semester exam preparation

From understanding sources of funds to mastering capital structure and working capital decisions, Business Finance equips BCom first-year students with the financial acumen and analytical confidence to excel in their semester examinations and future careers in finance, banking & corporate management.