Unit-7 Capital Structure Program : MBA Semester :I Subject Code : MB0045 Book Id : B1134 Subject Name : Financial Management Unit number :7 Unit Title : Capital Structure 1 HOME C oEXT d e n t i a l N nfi MB0045-Financial Management Unit-7 Capital Structure Introduction • The capital structure of a company refers to the mix of long-term finances used by the firm. In short‚ it is the financing plan of the company. • The capital structure
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banking has led me to see Islamic Banks in more detail. In this dissertation I will look at the financial structure of Islamic Banks. It will be studied that how the principle of “interest-free banking” affects the financial structure of Islamic Banks and Islamic Banks exhibit what kind of financial structure. 1.2 Objective The objective of this dissertation is to study the financial structure of Islamic Banks as they operate on a totally different basis from conventional banks. It will be seen
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Bank Case Study 2011 Question (1): Capital Structure and Financing in the Banking Industry Introduction Australian banks are an interesting case of capital structure and financing considerations as far as companies go‚ in that they are regulated in a number of ways by the Australian Prudential Regulatory Authority (APRA) and the Reserve Bank of Australia (RBA). Considerations of capital structure have the effect of reducing the cost of capital and so in turn increase the value of the
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Case Aspeon Sparkling Capital CASE 10 Water‚ Structure Inc. Policy INFORMATION Purpose This case‚ which in all aspects is identical to Case 9‚ illustrates the capital structure decision for a firm that starts with zero debt. Either Case 9 or Case 10‚ but not both‚ should be assigned. The primary analytical tool is valuation analysis‚ although the case briefly introduces the Modigliani and Miller (MM) with corporate taxes and Miller models. The case also illustrates financial risk by looking
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Specific objectives : 1. Understand the tools in analyzing firm’s financial statements 2.Compute the expected rate of return for investment projects. 3.Apply several valuation methods to value projects and companies. 4.Evaluate the optimal capital structure of a firm. 5.Identify the best way to return money to shareholders. 2) Course Textbook(s)/ Resources: Main textbook/ resources: Fundamentals of Corporate Finance‚ Robert Parrino‚ David KidWell‚ Copyright 2009‚ John Wiley c) Coverage: 6
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2.1 Strategy and Vision: Boeing’s mission statement states that they are the largest aerospace company and leading manufacturer of commercial airplanes and defense‚ space and security systems. It also talks about all of the countries that they support through exporting. Finally they talk about their products‚ their employees and their leadership. Boeing’s vision statement is to be the strongest‚ best and best integrated aerospace-based company in the world. Boeing’s corporate values include;
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CHAPTER 12 QUESTIONS 12-1 Operating leverage affects EBIT and‚ through EBIT‚ EPS. Financial leverage generally has no effect on EBIT—it only affects EPS‚ given EBIT. 12-2 Because Firm A has a higher fixed operating costs‚ its operating income will change by a greater percentage than Firm B’s operating income if sales change. Firm A has a higher degree of operating leverage than Firm B. 12-3 If sales tend to fluctuate widely‚ then cash flows and the ability to service fixed charges
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skills Ensure understanding of the course material Provide hands-on experience with Excel It will cover three broad areas of study: Financial statements analysis and forecasting‚ and free cash flow valuation of the firm Capital budgeting Cost of capital‚ leverage and capital structure policy You will demonstrate your proficiency in each area via three exams and three case analyses (using Excel). This course provides an intensive introduction to corporate financial decision-making and will prepare
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Power cost (per KWH) growth is 12%‚ per annum Plant Life is 10 years Pg 3‚ HBS 9-280-102 Plant Salvage Value is zero Pg 1‚ Assessed work Sheet EBIT is flat after 1984 Pg 1‚ Assessed work Sheet Capital Expenditures: $600‚000 per annum after 1984 Net Working Capital Remains flat after 1984 Pg 1‚ Assessed work Sheet Definition of “Flat” Pg 4 http://www.imf.org/external/pubs/ft/wp/2006/wp06218.pdf 6.5% is the Equity Risk Premium Slide 21‚ Risk and Return‚ class notes-
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growth capital‚ and privatization. In LBOs‚ they use capital structures to find the best combination of price‚ leverage and returns. In order to demonstrate a serious commitment and to achieve a desired rating‚ they decided in a minimum capital structure of at least 25% equity whereas debt is roughly 4 to 5 times EBITDA depending on market conditions. They also support its management by assisting in setting priorities right for the future of the firm‚ reviewing the organizational structure to ensure
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