Finance capital structure decision and cost of capital

Assignment Help Finance Basics

Reference no: EM1336699

Considering the following three companies:

i) eBay

ii) The Clorox Company (CLX)

iii) Alaska Air Group (NYS: ALK).

Upon reviewing total debt/equity ratios, company betas, profitability ratios, company revenue, assets, and liabilities, and the nature of the operations of the companies including the nature of their customers and products, what would you recommend should be the capital structure (total liabilities or debt and equity proportions) for each of the three companies?

Includes the following information:

- The nature of the business in brief (all three companies).

- Total current assets and long-term assets of all three companies.

- Total current liabilities and long-term liabilities of all three companies.

- Revenue of each company.

- Total debt/equity ratios of all three companies.

- Profit margin, return on assets, and return on equity ratios of all three companies.

- Betas of all three companies.

- The riskiness of all three companies in brief (e.g., the higher the beta, the higher the risk).

- The advantages and disadvantages of debt over equity financing.

Reference no: EM1336699

Questions Cloud

Explain the types of operations considerations : Discuss and explain the types of operations considerations

What dependencies there may be : For each one justify why you would select the particular file format and what dependencies there might be.

Local and capital structure : Why might a firm use a "local" capital structure at the particular subsidiary which differs substantially from its "global" capital structure?

Explain three marketing inefficiencies : Explain Three Marketing inefficiencies and Lack of understanding of or adjustment to the marketing environment

Finance capital structure decision and cost of capital : Upon reviewing total debt/equity ratios, company betas, profitability ratios, company revenue, assets, and liabilities, and the nature of the operations of the companies including the nature of their customers and products.

Quanity demanded among a stationary aggreate curve : Decreases aggregate quanity demanded among a stationary aggreate curve. E rases the equilbrium level of output and employment.

Determine process velocity : Mop and Broom Manufacturing estimates that it takes 4 1/2 hours for each broom to be produced, Determine process velocity.

Organization reward structure : Describe the relationship between type of reward structure employed by an organization for its employees and employee effectiveness and work productivity.

What are the ways a device can become infected : The spread of the mobile viruses has been slow since the mobile devices lack a prevalent OS like PCs and Windows. As mobile communications become more prevalent, so does the onslaught of viruses.

User Account

All Pages