Financial decisions are affected by various factors. Important factors are-Cost - To have a good financial decision the source of funds should be cheaper. Different sources have different costs of raising.Risk - This is also an important factor that will determine whether a financial decision was good or bad. With different sources, different risks are associated.Floatation cost - The source becomes less attractive if the floatation cost increases.Cash flow position of the company - Cash flow determines financing and funding.Fixed operating cost - If the operating cost the financing cost decreases. Low debt is favourable for the company.