In this article we will discuss about the risk and return faced while financial planning of a company. Costing and Risk: The word 'costing' relates to the ascertainment of cost of capital from different sources like equity capital, preference capital, debentures, long-term loans etc. The most crucial decision of any company is involved in the formulation of its appropriate capital [...]
After reading this article you will learn about Over-Capitalisation:- 1. Meaning of Over-Capitalisation 2. Causes of Over-Capitalisation 3. Effects 4. Remedies. Meaning of Over-Capitalisation: Over-capitalisation refers to that state of affairs where earnings of a company do not justify the amount of capital invested in its business. According to Gerstenberg, "A company is over-capitalised when its earnings are not large [...]
After reading this article you will learn about Over-Trading:- 1. Meaning of Over-Trading 2. Causes of Over-Trading 3. Signs 4. Consequences 5. Remedies. Contents: Meaning of Over-Trading Causes of Over-Trading Signs of Over-Trading Consequences of Over-Trading Remedies for Over-Trading 1. Meaning of Over-Trading: In simple words, over-trading means, "a situation where a company does more business than what its finances [...]