Capital structure decisions This article looks at the main ratios of investor interest and the impact of capital structure decisions on a company's market value. Selecting the best possible capital structure is a crucial strategic decision. We also look at the effects of changing the capital structure by changing the…
Cost of capital In this article, we will look at the concept of cost of capital that can be used as a discount rate in evaluating a firm's investment. We first base the cost of equity calculations on the dividend valuation model. Then, we will look at a method of…
Valuation of bonds Bonds are a vital source of financing for businesses and governments. Therefore, valuation of bonds takes place a necessary role for the finance manager. This article begins with a description of the characteristics of the bonds and the explanation of the parameters. It then describes how to…
What is long term Debt ? This section, we are going to analyze various sources of long-term debt financing. In general, debt financing is riskier for the issuer as the interest on the loan is payable. Whereas comparing with the equity fiance shareholders have the right to receive dividends only…
Equity financing alternative methods Equity financing alternative methods will be further analyzed in this article. Similarly, this article is a continuation of the "types of equity financing method" that we have discussed earlier. However, we will go through some of the equity financing related areas such as share repurchase, Employee…
What is equity financing ? Equity financing is one of the essential areas of corporate finance. Therefore, in this article, we describe the different ways to issue new equity capital. Also, it is vital to identify and evaluate optimal strategies to meet long-term financial needs. You should, therefore, consider the…
Importance of time value of money “Importance of time value of money” This is one of the crucial concepts in corporate finance. Even if you are a finance manager or student, you should have a good idea about the time value of money. Therefore, most of the time, the decision…
Cash operating cycle and the related areas In this article, we will go through the cash operating cycle, working capital cycle and the related subject areas. Such as managing inventory, managing receivables and managing payables. Working capital cycle is the period which laps between payment collection from customers and the…
"Short term financial strategy, what is working capital and how to finance working capital" In this chapter, we are going to discuss "short term financial strategy" , "what is working capital" and "how to finance working capital". What is short term strategy ? Any company needs liquid resources to finance its working…
Ratio analysis vs. company financial health in-dept analysis The purpose of ratio analysis is to determine whether an entity achieves its objectives. This article provides a means of a systematic review of financial statements. Uses of ratio analysis As a finance manager, you have to compare to get the meaningful…