Essential features of a sound capital mix, Financial Management

ESSENTIAL FEATURES OF A SOUND CAPITAL MIX

A sound or an appropriate Capital structure should have the following essential features :

  • highest possible use of leverage
  • Capital structure should be flexible
  • To avoid undue financial/business risk with the increase of debt
  • The use of debt should be within the capacity of a firm. The firm should be in a position to meet its obligations in paying the loan and interest charges as and when due.
  • It should involve smallest amount of possible risk of loss of control
  • It must avoid undue restrictions in agreement of debt
Posted Date: 10/16/2012 1:15:14 AM | Location : United States







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