Archive | Capital Structure

Capital Structure and Value of Firm | Financial Management

In this article we will discuss about the capital structure and value of firm.   Meaning and Definition of Capital Structure and Value of Firm: A firm mobilizes funds which, depending upon their maturity period, can be classified as long-term and short-term sources. The former consists of capital, reserves and term loans raised from public and […]

Calculation of Point of Indifference | Capital Structure

After reading this article you will learn about Calculation of Point of Indifference. The EPS, earnings per share, ‘equivalency point’ or ‘point of indifference’ refers to that EBIT, earnings before interest and tax, level at which EPS remains the same irrespective of different alternatives of debt-equity mix At this level of EBIT, the rate of […]

Capitalisation, Capital Structure and Financial Structure

The terms, capitalization, capital structure and financial structure, do not mean the same. While capitalisation is a quantitative aspect of the financial planning of an enterprise, capital structure is concerned with the qualitative aspect. Capitalisation refers to the total amount of securities issued by a company while capital structure refers to the kinds of securities […]

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