Essential features of a sound capital mix, Financial Management

Assignment Help:

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

Related Discussions:- Essential features of a sound capital mix

Noi approach, Two companies are identical in all aspects except in the debt...

Two companies are identical in all aspects except in the debt-equity profile. Company X has 14% debentures worth Rs. 25,00,000 whereas company Y does not have any debt. Both compan

Csae lets.., how would you judge the potential

how would you judge the potential

Financial capital, Assume that you have just "run out of money" and are una...

Assume that you have just "run out of money" and are unable to move your "idea" from its development stage to production and the startup stage.  However, you remain convinced that

Explain vernon’s product life cycle theory of fdi, Explain Vernon’s product...

Explain Vernon’s product life-cycle theory of FDI. What are the strength and weakness of the theory? Answer:  As to the product life-cycle theory, companies undertake FDI at a ce

#title., how can management use financial ratios

how can management use financial ratios

Accounting for financial instruments, The IASB is in the procedure of under...

The IASB is in the procedure of undertaking a comprehensive review of accounting for financial instruments, and has issued a latest financial instruments standard referred to as IF

Calculate the compound return, a)  What two legal documents should the coup...

a)  What two legal documents should the couple ensure are up-to-date if they want a sound estate plan?  What would happen if either became incapacitated or died and didn't have any

Define where security returns are found less correlated, Security returns a...

Security returns are found to be less correlated across countries than within a country. Why can this be? Answer:  Security returns are less correlated possibly because countries

Define the operating leverage effect, What is the operating leverage effect...

What is the operating leverage effect and what causes it?  What are the potential benefits and negative consequences of high operating leverage? The phrase operating leverage e

Break even sales, given just the sales and profit values, how is the break-...

given just the sales and profit values, how is the break-even sales calculated?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd