Capital reserve:
The reserve which transferred from the capital gains is called CR.

General reserve:
The reserve which is transferred from normal profits of the firm is called GR.

Minority Interest:
It refers to the equity of the minority shareholders in a subsidiary company.

Capital receipts:
Capital receipts may be defined as “non-recurring receipts from the owner of the business or lender of the money creating a liability to either of them.

Revenue receipts:
Revenue receipts may defined as “A recurring receipts against sale of goods in the normal course of business and which generally the result of the trading activities”.

Equity share capital:
The total sum of equity shares is called equity share capital.

Authorized share capital:
Is the maximum amount of the share capital, which a company can raise for the time being.

Issued capital:
It is that part of the authorized capital, which has been allotted to the public for subscriptions.

Subscribed capital:
It is the part of the issued capital, which has been allotted to the public

Called up capital: It has been portion of the subscribed capital which has been called up by the company.

Paid up capital:
It is the portion of the called up capital against which payment has been received.

Debentures:
Debenture is a certificate issued by a company under its seal acknowledging a debt due by it to its holder.

Cash profit:
Cash profit is the profit it is occurred from the cash sales.

Deemed public Ltd. Company:
A private company is a subsidiary company to public company it satisfies the following terms/conditions Sec 3(1)3:

1.having minimum share capital 5 lakhs

2.accepting investments from the public

3.no restriction of the transferable of shares

4.No restriction of no. of members.

5.accepting deposits from the investors

Secret reserves:
Secret reserves are reserves the existence of which does not appear on the face of balance sheet. In such a situation, net assets position of the business is stronger than that disclosed by the balance sheet.

These reserves are crated by:

1.Excessive dep.of an asset, excessive over-valuation of a liability.

2.Complete elimination of an asset, or under valuation of an asset.

Provision:
Provision usually means any amount written off or retained by way of providing depreciation, renewals or diminutions in the value of assets or retained by way of providing for any known liability of which the amount can not be determined

with substantial accuracy.

Reserve:
The provision in excess of the amount considered necessary for the purpose it was originally made is also considered as reserve Provision is charge against profits while reserves is an appropriation of profits Creation of reserve increase proprietor’s fund while creation of provisions decreases his funds in the business.

Reserve fund:
The term reserve fund means such reserve against which clearly investment etc.,

Undisclosed reserves:
Sometimes a reserve is created but its identity is merged with some other a/c or group of accounts so that the existence of the reserve is not known such reserve is called an undisclosed reserve.

Finance management:
Financial management deals with procurement of funds and their effective utilization in business.

Objectives of financial management:
Financial management having two objectives that Is:

1. Profit maximization: the finance manager has to make his decisions in a manner so that the profits of the concern are maximized.

2. Wealth maximization: wealth maximization means the objective of a firm should be to maximize its value or wealth, or value of a firm is represented by the market price of its common stock.

Functions of financial manager:

Investment decision

Dividend decision

Finance decision

Cash management decisions

Performance evaluation

Market impact analysis

Time value of money:
The time value of money means that worth of a rupee received today is different from the worth of a rupee to be received in future.

Capital structure:
It refers to the mix of sources from where the long-term funds required in a business may be raised; in other words, it refers to the proportion of debt, preference capital and equity capital.

Optimum capital structure:
Capital structure is optimum when the firm has a combination of equity and debt so that the wealth of the firm is maximum.

Wacc:
It denotes weighted average cost of capital. It is defined as the overall cost of capital computed by reference to the proportion of each component of capital as weights.

Financial break-even point:
It denotes the level at which a firm’s EBIT is just sufficient to cover interest and preference dividend.