Capital Structure in Finance - 1782 Words

The term capital structure in finance is the way a corporation finances its assets through the use of equity, debt, or hybrid securities (Ehrhardt Brigham, 2009). While equity and debt have long since been well known economic terms, hybrid securities is a relatively new concept. It essentially combines debt and equity and pays a set rate of return or dividend until a preset date, when the owner has a few options such as converting the securities into shares (Wikipedia). Capital structure is then simply the proportion of the corporations liabilities. For example, if a corporation has $2 billion dollars in equity and $8 billion dollars in debt, the ratio of debt to total financing is 80%, which also means it is 80% leveraged. In reality, there is not only two numbers, but there is a great deal of sources of the debt and equity which yields to the ratio of leverage. Another concept to consider is gearing ratio which refers to the percentage of capital the company uses from outside sour ces other than the companys own revenue, for example by short term business loans. The Modigliani-Miller theorem, which was created by Franco Modigliani and Merton Miller, was essentially the conceptual framework of modern capital structure. Unfortunately, the theorem relies heavily on disregarding many real life variables, however this does not distract from the main point of the theorem. Basically, the Modigliani-Miller theorem states that in a perfect world the modalities in which aShow MoreRelatedOptimal Capital Structure and Stock Price835 Words   |  3 Pages To put it simple way, first we have to understand optimal capital structure is maximizes a firm’s stock price, and the target capital structure is mix of the debt, preferred stock, and common equity the firm wants to have (Eugene and Joel 2009). The capital structure is also showing how a firm use different sources of funds to finances its overall operations and growth the stock price. Capital structure shows that how a firm’s assets have been established debt and equity, it is very important inRead MoreWhy Do Firms Choose Their Capital Structure?1623 Words   |  7 Pagesabout which securities to acquire and how to finance those investments: with equity, debt or a combination of both (Myers, 2001). The study of capital structure tries to clarify this variety of securities and financing opportunities. In accounting terms, this decision is situated on the right-hand side of the balance sheet (Myers, 2001). In his Capital Structure Puzzle article, Myers (1984) poses the question â€Å"How do firms choose their capital structure?†. But even today, there is no right solutionRead MoreArticles Relating to Capital Structure-Essay1658 Words   |  7 PagesContents :- Introduction on Capital Structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..5 Summary and Evaluation of Articles†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦6 Conclusion†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..8 References/Bibliography†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.9 â€Æ' Introduction On Capital Structure :- In the field of finance capital structure means a way an organization or firms finances their assets by the way of some mix and match of Equity, Debt or Hybrid Securities. The modern thinking on capital structure is based on the Modigliani-Miller theorem given by Franco ModiglianiRead MoreThe Importance Of Corporate Finance For An Entrepreneur1602 Words   |  7 PagesThis research has been conducted to examine the importance of corporate finance to an entrepreneur, and the role it plays in an organization regardless of the structure of a company, or stage of growth. The various forms of ownership are reviewed for startup companies and major corporations to highlight the advantages and disadvantages of each form of ownership, and to illustrate the importance of corporate finance. To provide a balanced view of ownership, less common forms of business ownershipRead MoreCapital Structure Of A Company1285 Words   |  6 PagesSUMMARY/ABSTRACT The Part-I of this paper analyzes the Treasury Manager and his various approaches towards the Capital Structure, by showing arguments for and against each theory. We discuss about four types of approaches that may be taken by the treasury manager while considering the Capital Structure of a Company. We have discussed Rolls Royce PLC’s capital structure strategy and analyzed the capital structure of the company over the past 10 years using an empirical case/research. The Part-II of this paperRead MoreFinancial Capital Structure Essays1549 Words   |  7 PagesContents : Introduction on Capital Structure Summary and Evaluation of Articles Conclusion References/Bibliography Introduction On Capital Structure :- In the field of finance capital structure means a way an organization or firms finances their assets by the way of some mix and match of Equity, Debt or Hybrid Securities. The modern thinking on capital structure is based on the Modigliani-Miller theorem given by Franco Modigliani and Merton Miller. The theorem suggests that in a perfectRead MoreWorking Capital Management in Healthcare Essay1514 Words   |  7 PagesWorking Capital Management in Healthcare Houma Guy. HCS 579 Health Care Finance September 24, 2005 Working Capital Management in Healthcare Working capital is the money required to finance the day to day operations of an organization. Working capital may be required to bridge the gap between buying of stocked items to eventual payment for goods sold on account. Working capital also has to fund the gap when products are on hand but being held in stock. Products in stock are at full cost, effectivelyRead MoreCapital Structure Of A Company960 Words   |  4 PagesII. INTRODUCTION Capital structure is the proportion of debt and equity in which a corporate finances its business. The capital structure of a company/firm plays a very important role in determining the value of a firm. There are various theories which propagate the ‘ideal’ capital mix / capital structure for a firm. A corporate can finance its business mainly by 2 means i.e. debts and equity. However, the proportion of each of these could vary from business to business. A company can chooseRead MoreEquity Finance And Debt Finance823 Words   |  4 Pagescompany with the risk capital such as preference share owners and ordinary share owners (Freeman and Reed, 1983). Generally, stockholderis one of long-term finance providers with the aim to maximize their wealth.According toBrickleyet al. (1985), long-term finance providers are more likely to focus on the matter whether the financial structure in the company is sound or not and the durability of profitabilityrather than temporary profits that a potentially risky financial structure may bring. In additionRead MoreCapital Structure Of A Firm1670 Words   |  7 PagesThe capital structure of a firm describes the way in which a firm raised capital needed to establish and expand its business activities. It is a mixture of various types of equity and debt capital a firm maintained resulting from the firms financing decisions. In one way or another, business activity must be financed. Without finance to support their fixed assets and working capital requirements, business could not exist. In all aspects of capital investment decision, the capital structure decision

Causes and Effects of the War of 1812 - 1527 Words

Causes and Effects of The War of 1812 The nineteenth century brought major change to The United States turning it from a developing country into a world power. The addition of Alaska, Oregon, Texas, and Florida, the Mexican Cession and The Louisiana Purchase made The United States a world power. The War of 1812 catalyzed this great expansion. There were four main concerns that led to The War of 1812. Maritime and trade issues, the Embargo Act, territorial expansion, and War Hawks. Although they were major concerns, one alone did not start up the war. â€Å"On June 18, 1812, the United States declared war against Great Britain. In what is often called Americas second revolution, the countries were locked in a series of battles for more than†¦show more content†¦In a battle outside of Prophet’s town of Tippecanoe River, Prophet foolishly decided to attack American militiamen while they were sleeping. The town was torched in the battle that followed, and years of planning and organization was wasted. After this incident in June 1812, Tecumseh and a small company of Native Americans joined the British at Amherstburg. During the war, American’s called for an invasion of Canada mainly because the support the British gave to American Indians. In the Battle of Thames, Tecumseh died and an American victory is gained. The War Hawks were a number of young representatives voted into the twelfth congress. They were typically people from southern and western states like Henry Clay, Speaker of the House at the time, John Calhoun of Kentucky and Langdon Cheves of South Carolina who spoke in Congress advocating going to war with Great Britain. They believed it was our right to expansion, and declared that a thousand Kentucky riflemen could take on Canada alone. They expected the war to be short, considering the British were in Europe fighting Napoleon. Although opposed by the Federalist of New York, New Jersey, and most of New England, on June 18, 1812 James Madison declared war on Great Britain. â€Å"However the War Hawks had displayed much more energy in talking about war than in planning and preparing for war. At the beginning of hostilities there were about 7,000 men in the regular forces and theseShow MoreRelatedCause And Effects Of The War Of 18121061 Words   |  5 PagesEdgar Vasquez Mr. Gill AP USH 9 October 2017 War of 1812 The War of 1812 is one of many wars that the USA will go through. The war is the first war that the new America would take part of and will be the first time the USA will declare war. The war lasted from June of 1813 to February of 1815, this is a span of two years and eight months. The war was fought by the United State verses the British. The war took place in many locations around the world which include the United States, Canada, onRead MoreWhy we Fought in the War of 1812 Essay1102 Words   |  5 PagesWhy we Fought in the War of The war of 1812 is considered by some as the second war for independence.1 The United States had won its independence in 1783, but the British still treated the Americans as though they still had control of them. Americans resented the treatment they received from the British. They felt they were a free country and the British would not recognize them as so. This is believed by many to be the cause of the War of 1812, but no one act can be contributed as such. ThereRead MoreWar of 18121643 Words   |  7 PagesThe War of 1812 was a war between Britain and the United States fought primarily in Upper Canada. It had many causes, few which involved British North America. The results of the war include the fact that there was no clear winner or loser among them. The only real losers in the situation were the Natives in the region. They were driven out of their lands and customs. None of the borders was changed by the war, though many attempts were made. The Treaty of Ghent, which e nded the war, did nothingRead MoreThe War of 18121132 Words   |  4 PagesWar of 1812 The War of 1812 was started by America due to British encroachment on three fronts, trade restrictions imposed by the British, the increasing alliances of the British with Indian tribes blocking American expansion West, and due to British interference with merchant class ships in the Atlantic. The war was fought in the Great Lakes region between America and Canada, near New Orleans in the Gulf of Mexico, in the Atlantic trade routes, and around Washington DC. The British had alwaysRead More War of 1812 Essay1612 Words   |  7 Pagesnbsp;nbsp;nbsp;nbsp;nbsp;The War of 1812 was a war between Britain and the United States fought primarily in Upper Canada. It had many causes, few which involved British North America. The results of the war include the fact that there was no clear winner or loser among them. The only real losers in the situation were the Natives in the region. They were driven out of their lands and customs. None of the borders was changed by the war, though many attemp ts were made. The Treaty of Ghent, which ended the war, did nothingRead More The War of 1812 Essay1090 Words   |  5 Pages The War of 1812 was fought between the United States and England. Ending in 1815 with the Treaty of Ghent, the war did not accomplish any of the issues it was being fought over. For the US, the War of 1812 seemed to just be one failure after another. Although the military suffered great failure during the war, these were the direct consequence of the failure of the citizens to unite for the causes of the war. Because of these failures, it is quite valid to call the War of 1812 quot;Americas worst-foughtRead MoreA Short Note On The War Of 18121368 Words   |  6 Pages18 April 2016 War of 1812 The War of 1812 was a battle fought between the United States and Great Britain, along with help from Canada and the Native Americans, from June 18, 1812 to February 18, 1815. The United States declared war against Great Britain due to multiple disputes that included trade restrictions against the United States, the capture of American sailors and the support of Native American tribes fighting against American settlers. These issues led to the War of 1812 which AmericansRead MoreEssay about Nature’s Influence on the War of 18121690 Words   |  7 PagesNature’s Influence on the War of 1812 Mother Nature played a part in every event in history, including the War of 1812. The War of 1812 was a conflict between the United States of America and Great Britain that had been building for many years. By the end of the war however there was no clear victor and the issues that caused the conflict were never resolved. Nature played a crucial role in the outcome. Because of humanity’s natural strive for power, the living and fighting conditions ofRead MoreThe Impact Of Technology On The Way War1703 Words   |  7 PagesJames Moore Mr. Brown Academy English 9 Honors 18 March 2015 After every battle of every war, troops are getting stronger, faster, and more accurate. Generals are getting smarter and creating more tactics and coming up with more battle strategies, but during all of this, the most drastic change is in the technology. Things are now becoming more computerized every day and it is very noticeable. Nowadays, everywhere you look no matter where at, a person with a smartphone, tablet, or computer willRead MoreThe War Of 1812 And The United States1427 Words   |  6 Pages The War of 1812 is the second war between the United States of America and Great Britain that ends in a draw. Also referred to as the â€Å"Second War of Independence,† the cause of this military conflict is often believed to be a direct result of England’s attempt to humiliate the United States, limit the country’s growth and impact (acts of interference towards American trade, which is a sign of disrespect towards American independence), and acts of impr essment (taking sailors off American vessels

Rana Plaza overview - Clean Clothes Campaign free essay sample

Rana Plaza, the collapsed eight-story commercial building located in Dhakas outskirt Savar, which housed several shops, a bank and garment factories, is the painful symbol of the grave tragedy encountered by garment workers.On 23 April 2013 large structural cracks were discovered in the Rana Plaza building. The shops and the bank on the lower floors immediately closed. But warnings to avoid using the building after the cracks appeared were ignored by the garment factory owners on the upper floors.Garment workers were ordered to return to work the following day. Due to management pressure, on Wednesday 24 April thousands of workers went to work again at their garment factories located in the cracked Rana Plaza building. Only hours later the entire building collapsed. Including rescue workers, 1138 workers were killed. Nearly 2600 workers were injured, many of them for the rest of their life. Many of the survivors had been trapped under tons of rubble and machinery for hours or even days before they could be rescued, sometimes only by amputating limbs. We will write a custom essay sample on Rana Plaza overview Clean Clothes Campaign or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page This gruesome tragedy has devastated the lives of thousands of workers and of the families of the deceased and injured. Their sufferings are horrific and require immediate and long-term medical care and compensation.The deceased and injured workers in the Rana Plaza tragedy were producing garments for North American and European high street brands when their factories collapsed. A number of brands have acknowledged recent production or orders with these factories. Brands that were sourcing from the factories in Rana Plaza building include Benetton (Italy), Bon Marche (UK), Cato Fashions (USA), The Childrens Place (USA), El Corte Ingles (Spain), Joe Fresh (Loblaws, Canada), Kik (Germany), Mango (Spain), Matalan (UK), Primark (UK/Ireland) and Texman (Denmark).The unprecedented scale of the Rana Plaza and previous tragedies including the fire in the Tazreen factory underlined the need for a coordinated, systematic approach to ensure fire and building safety in the Bangladesh garment industry.In May 2013 the Accord on Fire and Building Safety in Bangladesh was published and subsequently signed by over 150 companies. Factory inspections have started and the first renovation plans have been published. Also, Rana Plaza victims are to receive compensation under the Rana Plaza Arrangement.The Arrangement is an unprecedented coordinated approach to ensure all those wh o have suffered due to the collapse will receive payments to cover the loss of income and medical costs. However, many implicated companies still need to pay up to the Arrangements Donor Trust Fund. In 2014, CCC and its allies are demanding that brands pay their long overdue contributions. Meanwhile, engaging with trade unions in Bangladesh is the fundamental and first step to ensure safety for the workers in the garment industry.