Foreign Affairs Enterprise Capital Income And Expenses Problem Studies

This article has considerable academic values, by searching the capital movement for modern enterprises. Most of the researchers were focusing on the property of the enterprises, the relationship between yangwu enterprises and capitalism, sharing capitals and gathering capitals of modern enterprises, or studying from the relationships among the yangwudachen. It is rare to research the economic movement of yangwu enterprises by applying economic theories to typical yangwu enterprises in superficial understanding.Insufficient capital is an important factor that is limiting the economic development in Chinese modern history. This article starts from discussing capital gathering and spending, takes military enterprises in the early stage and civilian enterprises in the later stage of the Westernization Movement for example, conducts in-dept analysis which is divided into 3 parts:Part 1: The early stage of the YANGWU movement typically saw western weapon and marine vessel purchase and military industry building-up. During this time, the government mainly invested in building up the military industry. Take the south of Yangzi River manufacture bureau, the Jinling shop of war and so on typical Military enterprise as an example, induces Military enterprise's capital revenue and expenditure question separately from several aspects.According to companies, which are selected for analysis in the article, they inherited the old industrial management style, which is that the government provided for all the funding to the enterprises, and had full control of finance and appointing management personnel. These enterprises inherited most from the feudal system, and isolated themselves from the market, and totally ignorant of the market demand, which made the"learning from the western world"become only a theory, and nothing like this was put into practice. Due to the huge amount of funding required, complicated technologies involved and high requirements for management, the private businessmen had no way to be able to put a finger on the industry. Wherever in the more developed coastal area or in the inland where the transport was badly coping, the industry had to always rely on the government funding, rather than gathering money by themselves, which was virtually impossible. Most of the companies applied the funding from the government according to what they need, and the funding was contributed by certain percentages of the income from the custom duty, band interest and financial earning of the government.The government basically kept feeding money for what they had spent. When the central government or local government transferred the funding according to what the companies had required, they generally set up dedicated accounts so that the money could not be use for other purposes, and the companies usually didn't have to worry about the cost of the manufacturing. The enterprises which were built up based on such a system under the protection of the government's umbrella, were hardly competitive and the business was hardly sustainable. When the government had finance trouble itself, they would not be able to keep the business going, and destined to be short-lived prosperous.Part 2: In the late stage of the Westernization Movement, there were 3 kinds of civilian enterprises according to the forms of the operating, operated by the government, co-operated by the government and the private businessmen, and operated by the private businessmen under the government supervision. In the article main selection managed by the people enterprise's several typical enterprise's concrete events, study the westernization movement time Commercial business's capital revenue and expenditure question. This part discusses in details the capital gathering and spending in the civilian enterprises, which was run by a private owner under the government's supervision, by analyzing the definition of capital and applying the concise formula in Economics, e.g. G-W-G` (G represents Money, W represents products, G`=G+^G, ^G means the increased value ).These private-operated enterprises had variety of sources to gather funding, and share hold was the most important among these sources. When the business was in difficulty, they could also borrow money from the government in a short term. Regardless the high interest rate, the money borrowed from the government helped the companies keep business going, get over the difficulty and even make profits if used properly. Another way to gather money was to borrow money from overseas. Usually the interest rate from the overseas was lower than the domestic market interest rate, the companies would have less pressure for returning the money, so it was very helpful for these companies. However, borrowing form overseas was very often with political conditions, which made the companies which needed the money have to be very careful when making decisions to borrow the money.There were some differences in spending in the civilian companies from the military companies. In the civilian companies, apart from the wages, money would be spent on infrastructure expansion, investment on building more factories, building supporting sites and offices, etc. which would enable the companies make more profits. In some sense, these investments reflected the improvement in the enterprises management. However, because the old management concepts inherited from the feudal system were still driving the business, these investments often failed in the middle, or even failed at the beginning. As a result, it was very difficult for these companies to be transformed to the modern western-style enterprises.Part 3: Conclusions. As discussed above, these westernized companies have variety of sources to gather funding, among them were custom duty, which was originated after the Opium War, as well as the bank interest, land rate and offering and so on, which were the main financial income for the government in the feudal time. The companies that managed to get the government investment only got small amount of funding from the central government, while large amount came from the local government.The spending in these westernized companies was most for manufacturing, and spending in military companies was different from civilian companies. Military companies were able to get funding from the government to cover the cost, therefore they could well balance the income and cost most of the time, and there was no need for them to calculate profits. In contrast, civilian companies had to cover cost for themselves, so they had to plan budget on spending, and the best profitability was always their focus. The companies, either military companies or civilian companies, all needed to pay wages to their staff in time, and as different levels of technical workers gradually emerged, they moved one step closer to the modern westernized companies.