Difference between debtcapital and equity capital, Financial Management

Assignment Help:

Difference between Debtcapital and Equity capital

Debtcapital comprises:

  • Long-term loans (debentures, loan stock etc.)
  • Preference share capital
  • May also include bank overdrafts, but not necessarily

All the above are termed as interest bearingcapital.

Equity capital comprises:

  • Ordinary share capital
  • Share premium
  • Retained profits or losses
  • Any reserves

All the above are termed as shareholder funds

 

 


Related Discussions:- Difference between debtcapital and equity capital

What are the major sections of the statement of cash flows, What are the ma...

What are the major sections of the statement of cash flows? a.Cash flows from Operations b.Cash flows from investing activities c.Cash flows from financing activities

Pay back period (pbp) , Pay Back Period (PBP) : This is the most popula...

Pay Back Period (PBP) : This is the most popular method employed by industrial practitioners for ranking investment projects. This is described as the "period required for a pr

Time value of money, Ask quSteve and Ed are cousins who were both born on t...

Ask quSteve and Ed are cousins who were both born on the same day, and both turned 25 today. Their grandfather began putting $2,500 per year into a trust fund for Steve on his 20th

Attempt to pay cash dividends to common stockholders, Are there any legal f...

Are there any legal factors that could restrict a corporation in its attempt to pay cash dividends to common stockholders?  Explain. A firm may be lawfully restricted as to the

Define country’s economic well being enhanced, How is a country’s economic ...

How is a country’s economic well-being enhanced through free international trade in goods and services? As per to David Ricardo, with free international trade, it is mutually adv

What is risk free rate of return, What is risk free rate of return Ther...

What is risk free rate of return There is a 'risk free rate of return' (also known as time preference rate) which is used to compensate for the loss of not being able to invest

Determine the value of the forward contract, Mr. Lam holds title to an asse...

Mr. Lam holds title to an asset worth €125.72. In order to raise money for an unrelated purpose, he plans to sell the asset in nine months. But Mr. Lam is concerned about the uncer

What do you mean by time value of money, Q. What do you mean by Time value ...

Q. What do you mean by Time value of money ? The concept of TVM refers to the fact that the money received today is different in its worth from the money receivable at some oth

Integration of economic, a) Globalisation refers to the interdependence and...

a) Globalisation refers to the interdependence and integration of economic, social and politic issues (services, goods, people and capital), across the world. For example, consumer

Pension fund management: a global perspective, Pension Fund Management: A G...

Pension Fund Management: A Global Perspective Pension funds are known worldwide more for their social security element. They have assumed more importance from the day the priva

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd