GB550_Unit_6_Assignment.docx Unit 6: Assignment GB550: Financial Management Purdue Un

GB550_Unit_6_Assignment.docx    Unit 6: Assignment  GB550: Financial Management  Purdue University Global  1. Complete questions  Define each of the following terms:  a)Operating plan; financial plan  Operating plan – is a short-term plant that is defined by the managers achieve an objective. From the text “A plan that highlights corporate strategy and provides detailed steps of implementation to management of a firm in order to meet corporate objectives is referred as operating plan” (Brigham & Ehrhardt, 2019)  Financial Plan – defined as a plan to optimize the use of capital with the assumptions of future sales and expenses, business projections.   b)Spontaneous liabilities; profit margin; payout ratio  Spontaneous liabilities – are the liabilities that change with the increase and decrease in relation to revenue streams along with the production costs.  Profit margin – Profitmargin calculates profit for each dollar earned in revenue. It is calculated by dividing net income by sales revenue (Brigham & Ehrhardt, 2019)  Payout ratio – The percentage of dividend payouts by a firm is referred to as Payout Ratio. (Brigham & Houston, 2019).  c)Additional funds needed (AFN); AFN equation; capital intensity ratio; self-supporting growth rate  Additional funds needed (AFN) – is the amount of money a firm must obtain from an external source in order to afford what is being sought after.   AFN equations   Capital intensity ratio – is the ratio of total assets to sales, and defined as the ratio o