"Major Considerations In Capital Structure Planning" Essays and Research Papers

1 - 10 of 500

Major Considerations In Capital Structure Planning

Major Considerations in Capital Structure Planning There are three major considerations in capital structure planning, i.e. risk, cost of capital and control, which help the finance manager in determining the proportion in which he can raise funds from various sources. Although, three factors, i.e. risk, cost and control determines the capital structure of a particular business undertaking at a given point of time. The finance manager attempts to design the Capital Structure in such a manner...

Premium Capital structure, Corporate finance, Debt 601  Words | 2  Pages

Open Document

Capital Structure

CAPITAL STRUCTURE: MEANING: - Capital structure of a firm is a reflection of the overall investment and financing strategy of the firm. - Capital structure can be of various kinds as described below: ▪ Horizontal capital structure: the firm has zero debt component in the structure mix. Expansion of the firm takes through equity or retained earnings only. ▪ Vertical capital structure: the base of the structure is formed by a small amount...

Premium Balance sheet, Capital structure, Corporate finance 554  Words | 3  Pages

Open Document

Capital Structure

Assignment 1. Some of the key trends in the capital structure of India Inc. are as follows: Key observations: * Indian corporate employ substantial amount of debt in their capital structure in terms of the debt-equity ratio as well as total debt to total assets ratio. * As a result of debt-dominated capital structure, the Indian corporate are exposed to a very high degree of total risk as reflected in high degree of operating leverage and financial leverage and, consequently, are...

Premium Asset, Balance sheet, Capital structure 1456  Words | 5  Pages

Open Document

Capital Structure

Capital Structure In finance, the term “capital structure” refers to the way a firm finances its assets. Generally speaking, there are two main forms of capital structure: debt financing and equity financing (Cumming 52; Myers, 83). Each type has its own advantages and disadvantages, and an essential task for the successful manager of a firm is to find an optimal capital structure in terms of risk and reward for stockholders. When making decisions that affect capital structure, managers must be...

Premium Capital structure, Corporate finance, Debt 2014  Words | 7  Pages

Open Document

CAPITAL STRUCTURE

Capital structure describes how a corporation has organized its capital—how it obtains the financial resources with which it operates its business. Businesses adopt various capital structures to meet both internal needs for capital and external requirements for returns on shareholders investments. As shown on its balance sheet, a company's capitalization is constructed from three basic blocks: Long-term debt. By standard accounting definition, long-term debt includes obligations that are...

Premium Corporate finance, Debt, Finance 1599  Words | 5  Pages

Open Document

capital structure

A review of capital structure theories 1.0 Introduction One of the most contentious financial issues that have provoked intense academic research during the last decades is the theory of capital structure. Capital structure can be defined as a 'Mix of different securities issued by a firm' (Brealey and Myers, 2003). Simply speaking, capital structure mainly contains two elements, debt and equity. In 1958, through combining tax and debt factors in a simple model to price the value of a company...

Premium Asymmetric information, Capital accumulation, Corporate finance 1069  Words | 3  Pages

Open Document

Capital Structure

in order to ensure long lasting success. One of the major operating risks is the need to continuously keep in touch with the ever-evolving sports world, as well as the demand of consumers who are constantly demanding new products and services. Financial Risks of Nike The strong indication of a company’s financial risks is the debt to total capitalization ratio. This ratio measures the portion of a company’s total capital structure that is financed by debts. The ratio is calculated...

Premium Asset, Balance sheet, Corporate finance 1206  Words | 4  Pages

Open Document

Capital Structure

we will explain capital structure and determine weighted average cost of capital (WACC) from the assumption provided by Mary Francis. Furthermore, we will show how WACC and Capital Structure can be leveraged to find out the viability of the capital project. Additionally, we will explain marginal cost of capital. To close, we will make a recommendation on the best approach to apply to project evaluation between capital structure and WACC Capital Structure Capital Structure refers to the sources...

Premium Capital structure, Corporate finance, Economics 1020  Words | 4  Pages

Open Document

Factors determining Capital Structure

Capital Structure: The most important function of Financial Management is to make decisions about the capital structure of firm. Capital structure refers to the make up a firm’s capitalization. It represents the mix of different sources of long term funds in the total capitalization of the company like equity shares, preference shares, retained earnings, long-term loans etc. In other words it can be precisely told as financing plan of the company. Capital is required to finance investments in plant...

Premium Capital structure, Cash flow, Corporate finance 1612  Words | 5  Pages

Open Document

Optimal Capital Structure

OPTIMAL CAPITAL STRUCTURE INTRODUCTION This report tries to visualize “OPTIMAL CAPITAL STRUCTURE and represent the facts that include features of capital structure, determinants of capital structure, and patterns of capital structure, types and theories of capital structure, theory of optimal capital structure, risk associated with capital structure, external assessment of capital structure and some assumption related to capital structure. BROAD OBJECTIVE • To determine features of capital...

Premium Basic financial concepts, Capital structure, Corporate finance 1496  Words | 6  Pages

Open Document

Become a StudyMode Member

Sign Up - It's Free