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Using Objectives & Strategies (1)
Corporate Objectives = goals/targets of the whole organisation, usually based on its mission or aims = providing a mechanism for ensuring that authority
can be delegated without loss of coordination.
Functional Objectives = goals/targets of each of the functional areas of a business, usually based…

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Current assetsowned <1 year

Non-current liabilitiesdebts due for repayment after >1 year

Current liabilitiesdebts scheduled for repayment within 1 year

Share capitalfunds provided by shareholders through the purchase of shares

Reserves/retained earningsitems that arise from increases in the value of the company
Purposes of balance sheet
Recognising the scale of…

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2nd section = shows efficiency of firm in controlling its expenses = if expenses firm should be able to secure a operating profit

3rd section = finance income + finance costs give an indication of how much the business borrows + lends money + the efficiency with which it handles…

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Shows the operating profit as a percentage of capital employed; capital employed equates to the value of the capital that a business has at its disposal.
Should exclude exceptional items to get a better value = exceptional items…

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These calculations ignore the gains or losses that can be made from owning shares = if share prices are increasing, the dividend yield will fall, but owning
these shares will be a more attractive proposition. A fall in the share price will increase the dividend yield but may be seen…

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Demotivation = may add pressure and stress imposed on staff, who may have technical skills that do not include financial management = demotivate staff
who want to use their technical ability rather than financial skills or do not have time for extra work
Setting targets = for specialist areas, the…


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